Comments on: Yet Another Restatement?

By: Anonymous

Anonymous — Sun, 11 Mar 2007 16:08:16 +0000

The market needs to finally realize Jim Cramer’s observation for Nortel:
“A really terrible company and an even worse stock”.

Nortel has teased investors for years now with stories about how it’s going
to turn things around all the while having to continually restate financials
and layoff employees.

It is highly dubious when a company can only attempt to make it’s numbers
by laying off employees on a regular basis.

If you’re going to invest in anything in the telecom equipment sector then
investigate anything other than Nortel.

Try to go with “best of breed” not “worst of breed” unless you’re the
ultimate contrarion and have a fond affection for horribly mismanaged
companies.

By: Apple

Apple — Fri, 09 Mar 2007 13:15:49 +0000

NT removed $3.5 bill revenue from the books in 2003.
I think that is the fact.
Lets look for it in the books that fallow.
Did NT recognize it in 2004? no! 2004 did not show $3.5 improvement!
Did NT recognize it in 2005?
no, NT removed additional $1.5 bill in 2004-2005!
OH ya, you think NT will report $5 bill more in 2006!
wrong again, 2006 will recognize around $24 mill of $5 bill removed!
and yes, NT investors, you can dream about $5 bill revenues waiting for recognition in 2007!
Dreamers?
Any accountant can tell you that it defies accounting to expect removed revenues in 2003 to appear on books in 2007 or later!
So what was it?

By: the application delivery network » A Slow Week in Application Delivery

the application delivery network » A Slow Week in Application Delivery — Mon, 05 Mar 2007 19:54:40 +0000

[...] Things seemed to slow to a crawl in the adn market after Cisco’s announcement, with the most bits being spent on discussing Nortel’s current woes of a crazed executive and its announcement that it will, once again, restate its earnings. [...]

By: Not Observer

Not Observer — Mon, 05 Mar 2007 16:38:11 +0000

It should be known that a change in auditors CAN NOT happen until shareholders approve the change at an Annual General Meeting. This hasn’t happened. KPMG in not Nortel’s current auditor at this time. The change in auditor proposal should pass, but we need to understand the facts.

When we see the 2006 Annual Report pay attention to Deferred Revenues. This is a holding bucket for future revenues that have yet to pass GAAP requirements for revenue recognition. This is where revenue adjustments land.

By: many

many — Mon, 05 Mar 2007 05:01:26 +0000

“………there will be no room for that arrogant type of manager that may feel invincible and above the regular employees.”

“……….Lead by example is what comes to mind,even if you donâ€™t hold a managerial position you can still make an impact especially as Nortel continues to transform itself towards the â€œBIGâ€ goal.”

Are you referring to Joel Hackney with these statements? If so, you certainly have a point, but only if the leadership “walks the walk”. Right now things don’t look too good.

Six-Sigma is a gimmick and a buzz word left over from the 90′s. When I was with Nortel I traveled to India for them to interview some of the “six-sigma” software houses. Believe me when I tell you it is not the panacea you have been lead to believe. Its like TQM and Quality Circles were during the 1980′s when Japan was going to eat our lunch.

You need to understand that unless Mr. “Z” can make profitable sales deals(unlike the India and Iraq deals) they will not survive. Unless he can cut SG&A costs (which so far he has not been able to do) they will not survive. I would be willing to bet that the same ratio of senior management to employee as was true in the 1990′s exists today. I would believe that the same SG&A costs per employee exist today. Bottom line; the margins just ain’t there.

If Mike “Z” wants to lead by example, working for US$1.00 like his competitor Mr. Chambers instead of looting the sinking ship would be a good gesture. Publicly firing the bully Joel Hackney would be a good gesture. Cutting the ratio of managers to workers and increasing the span of contol for the remaining would be a good gesture. Ultimately they are going to have to leave one or two lines of buisness and stop being a mile wide and an inch deep.

By: Apple

Apple — Sun, 04 Mar 2007 23:13:03 +0000

While the restatement is relatively minor, itâ€™s certainly not a positive sign for a company that appeared to be gaining its footing again and more confidence from investors.
===========
re
There is nothing minor about Nortel’s restatements!
To remind you 2004, bi-weekly statements increased the size and scope as time was passing by.
Who would expect $3.5 bill revenues removed?
There was nothing minor in last year restatement too.
Nortel played it low from the beginning. Just few hundred millions and no wrong doing, said Mike Z.
When he was asked how did he know there was no wrongdoing, he apologized few days later and stated that nobody checked if there was no foul play.
Nobody was surprised by new delays and new restatements at Yahoo_NT message board as we deducted that Nortel will not be able to report on time and will restate again
So 2005 will look even worse and Q2 2005 Triple Profits are buried deep in losses now. When we will see questions about reporting false Q2 Triple Profits? It’s an easy job just to imagine investors losing money playing put options for example and losing all just because Nortel reported false numbers to boost the stock price up to $3.50 or so…
When will someone ask Nortel about $5 bill revenues removed from the books so far? Where is that revenue?
CFO quitting and auditors replaced at the same time is not a minor thing either.
Nortel has not finalized first lawsuits yet and the new are waiting in line for misleading in 2005 and 2006!
SEC should put a stop to Nortel’s misery long time ago!
Clean the books if you can and come back to the open market after that.
How it is possible that Nortel stated once again that 2007 numbers can be late and restated too as the accounting system is not working properly yet!
What a joke!

By: Not_A_Co-Worker

Not_A_Co-Worker — Sun, 04 Mar 2007 18:44:06 +0000

JJH and the psychiatrist = same person? No I don’t think so but is clear who is paying the psychiatrist!

By: The psychiatrist

The psychiatrist — Sun, 04 Mar 2007 08:21:55 +0000

To many- I agree with you 100 percent,in that it is usually the management that sets the tone and is a major factor in establishing the culture that descends on all employees,however reality has set upon Nortel and as Mike Z and his new executive ranks sift through the entire operation,there will be no room for that arrogant type of manager that may feel invincible and above the regular employees.

The new Nortel means that there is a changing of the tide and therefore sooner rather than later all will become accountable including management,needless to say that employees who take issue with management can do so in a constructive way and result in creating a better run company,as there can be no positives from employees who allow their emotions to determine their work ethics.

Lead by example is what comes to mind,even if you don’t hold a managerial position you can still make an impact especially as Nortel continues to transform itself towards the “BIG” goal.

A perfect example of how the individual can make a difference is if you compare the Japanese auto industry and how hugely successful they have become to stea lmarket share from the big three,this phenomena has been linked to the culture that exists between the employees and the car makers.

Mike Z is on the right track when his goal is to achieve six sigma as full credit should be given for realizing Nortel’s current ailment.

If Nortel is to achieve greatness it will only come when pride and accountability will be the order of the day,and it starts right from the very bottom all the way to the top.

Harbouring vindictiveness towards Mr.Hackney because he is in an executive position will not help Nortel reach its road to greatness, remember that he is a human being fiirst before anything else and that entails making mistakes and poor judgement on occassion.

By: just a nortel employee

just a nortel employee — Sun, 04 Mar 2007 02:27:53 +0000

Zafirovsky is probably more annoyed about the need for another restatement than every other employee or shareholder. The restatement is a left-over from the old Nortel and not a fault of the new MikeZ-Nortel.
The financial trouble was caused by the gang who drove the company before he came. And he needs a successful Nortel story to qualify for ‘higher’ tasks. For sure he’s pissed.
Zafirovsky is the only one of our latest CEO’s who really undertook actions to turn the ship around. Either he will make Nortel a successful company (a completely different Nortel than it was) or it’ll be over forever. But I am optimistic that this Jack Welch clone will make the grade.

By: not laid off yet employee

not laid off yet employee — Fri, 02 Mar 2007 15:37:48 +0000

Have you been to any Nortel sites lately? There are no water cooler or hallway discussions. That was the old Nortel culture, and anyone who is disgruntled or known to spread rumors has been laid off or has left the company. I think most, if not all employees want Nortel to turn around and to be successful so we can make some $$, but how many of us were involved in the accounting scandals. Comments made here are in response to “Yet another restatement”…. Employees hear this news at the same time as you do, and are clearly not trilled with it. This blog gives folks a much needed way to vent. If you vent at the office you will likely be laid off in the “next round”.