Halliburton Gets SEC Inquiry - TheStreet

A change in accounting procedure adopted when it acquired Dresser Industries is visiting federal scrutiny upon


(HAL) - Get Report


News of the probe sent the company's shares down $1.25, or 6.5%, to $18.10 in Instinet premarket trading.

The Dallas-based former employer of Vice President Cheney said the

Securities and Exchange Commission

has opened a preliminary inquiry into the way it books revenue from cost overruns on construction jobs. The probe focuses on a treatment adopted after the 1998 acquisition of Dresser in which Halliburton records such negotiated overruns when it expects to collect them from a customer.

"The company has continued this accounting treatment of similar items since 1998 and has never recorded a profit on a job where an unapproved claim or change order has been recorded in revenue," Halliburton said in a statement, adding that it believes its accounting is in accordance with generally accepted principles. Halliburton intends to cooperate with the inquiry.

On Tuesday, Halliburton said it had settled 30 asbestos lawsuits pending against it in a New York federal court. Terms of the agreement weren't disclosed.