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Board Members Resign From Troubled Belgian Software Maker IEPER, Belgium, Nov. 28, 2000 (SmartPros) Amid investigations into accounting regularities and reports of a possible conflict of interest at its internal auditor KPMG, troubled Belgian speech recognition software maker Lernout & Hauspie said three members of its board of directors have resigned. Former co-chair and managing director Pol Hauspie, former managing director Nico Willaert, and former chief executive and president Gaston Bastiaens resigned from the firm last week. L&H also announced the immediate suspension of Joo Chul (John) Seo as president and general manager of L&H Korea and his removal as a director of L&H Korea. Seo was immediately relieved of all responsibilities. "The decisions we have made represent the commitment of L&H's new management and Board team to a comprehensive remedial course of action," said John Duerden, managing director, president and chief executive of L&H. "We are committed to working closely with our outside auditor, KPMG, to restore their trust." On Nov. 9, the same day L&H announced it would restate its financial statements for 1998, 1999 and the first half of 2000 due to accounting irregularities uncovered during an internal investigation, Hauspie and co-founder Jo Lernout stepped down as co-chairs and managing directors of the firm. Hauspie had taken a leave of absence for medical reasons from his responsibilities as a board director. At that time, Willaert also stepped down as managing director. Dong-Hee (Daan) Kim, formerly a vice-president with the enterprise and telephony solutions division, has been appointed acting president and general manager of L&H Korea. Shortly after the firm's decision to restate its financial results, its independent auditor, KPMG Bedrijfsrevisoren, said that its auditor's reports relating to the company's financial statements for 1998 and 1999 could "no longer be relied upon." L&H also said that in the course of its investigations, its internal audit committee identified "facts which may have been concealed from its auditor." The Wall Street Journal earlier this month reported a potential conflict of interest at the Big Five firm, in light of a discovery that the KPMG partner who was in charge of auditing L&H for many years had joined an L&H affiliate last year, shortly after KPMG signed off on the Belgian software company's now-disputed 1998 accounts. Send comments to information@smartpros.com. |
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