‘HP executives were aware of Autonomy sales tactics’

Hewlett-Packard’s senior executives were aware of certain Autonomy sales practices months before a whistleblower flagged them, prompting HP to write down Autonomy’s value, the Financial Times reported.

HP — which bought Autonomy for $11.1bn in 2011 only to write down its value by $8.8bn a year later — has accused Autonomy officials of accounting fraud.

Suggestions that HP may have known about some of Autonomy’s practices before the whistleblower came forward could weaken its argument that Autonomy officials buried information.

Autonomy’s practice of selling hardware to clients at a loss had been documented by auditors and a report was provided to HP after it bought the British software maker, the newspaper said.

HP executives were included in communications about Autonomy’s sales before the whistleblower brought the transactions to light, the newspaper said.

In an October 2011 email, Autonomy cited difficulties it was having in selling HP hardware, the paper said.

However, HP said while it eventually learned about the sales, it knew nothing of the alleged accounting improprieties until the whistleblower came forward.

Autonomy was founded and led by Tipperary-born entrepreneur Mike Lynch, who denies HP’s allegations.