Governance: Former Arthur Andersen partner suspended by SEC
Daniel F Stulac, CPA, was a partner at Arthur Andersen and in charge of the Audits of Peregrine Systems, inc for the Y/E September 2001. The SEC has alleged that Peregrine fraudulently inflated its figures - and Stulac knew or was reckless in relation to the facts uncovered. He has been suspended from appearing before the SEC for a minimum of five years.
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The SEC alleges that Peregrine used a number of tactics to fraudulently increase its "revenues" figures including booking as sales "non-binding arrangements with resellers." This led to a large balance sheet figure which could not be recovered, and which the directors "improperly wrote off."
Stulac, the SEC said, "knew or was reckless in not knowing that Peregrine's 2001 financial statements improperly recognised millions of dollars of revenue from agreements with resellers."
The Order does not affect Stulac's continued practice as a CPA or auditor not involving the SEC.
Several persons have been jailed as a result of the Peregrine affair but charges were dismissed against Stulac.
The company collapsed and was bought by Hewlett Packard in 2005 - for just double its then turnover.
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