Business & Finance
Another major accounting scandal appeared possible as the world's largest supplier of temporary workers admitted to "material weakness in internal controls" at its North American operations as well as potential irregularities elsewhere. Adecco SA, based in a suburb of Zurich, Switzerland, postponed release of its audited financial statement for 2003 and said it couldn't predict when the report would be available. The news triggered a 48 percent plunge in its share price on the Zurich stock exchange. Adecco provides 650,000 "temps" a day to clients in 63 countries, many of them in the banking, information technology, and telecommunications sectors. It also offers consulting, outplacement, and executive-search services. Adecco bought Olsten Corp. of the US four years ago for $1.55 billion. Financial analysts said they weren't yet willing to put Adecco's problems in the same league with those of European corporate giants Royal Ahold and Parmalat, but agreed that the situation seemed serious.
Royal Dutch/Shell Group cut its estimate of proven oil and natural gas reserves by about 20 percent Friday, saying it still believes the fuels are present but some recovery projects need to develop further. The disclosure sent Shell's share price down more than 7 percent on European stock markets Monday. It comes as the Securities and Exchange Commission is stepping up scrutiny of the industry's reserve reporting practices, The Wall Street Journal said.
British Petroleum announced it will sell its 2 percent stake in Hong Kong-based PetroChina, a transaction it hopes will yield about $1.6 billion. The two have had a sometimes tumultuous relationship over the past 3-1/2 years, although a BP spokesman said his company remains committed to PetroChina and to the Chinese market, in which it expects to invest at least $3 billion between now and 2009, according to a report in the Financial Times.
Siemens, the electronics/engineering giant, sold half of its stake in Infineon Technologies, the maker of memory chips it spun off almost four years ago. The deal, valued at $2.3 billion, appeared timed to take advantage of a new surge in the chip market. In the past two years, Infineon has become the sixth-best performer of Germany's bellwether 30-member DAX stock index.