According to an investigation held by the Securities and Exchange Commission recently, it has been discovered that Monsanto Company had insufficient internal accounting controls. Therefore, they have agreed to pay an $80 million penalty.
The Monsanto Company is going to pay the penalty amounting to $80 million to settle the charges that it has violated accounting rules and have misstated company earnings as well. According to SEC News, Monsanto booked substantial amounts of revenue resulting from their sales yet failed to recognize all the other related costs during the same time. It was then concluded during the investigation that the company materially has misstated their consolidated earnings in corporate filings in a span of three years. The Director of the SEC's Division of Enforcement also stated that they are committed to punishing corporate executives whose actions may have contributed to the filing of inaccurate financial statements.
Their case against Monsanto has revolved around a corporate rebate of program designed to boost the sales of Roundup which is popularly known to be a weed killer. The program was created to fight the rising generic competition that has threatened to cut the company's profits, as reported by Yahoo News. The company has insufficiently accounted millions of dollars in revenue. In agreement for a settlement, Monsanto Company has neither denied nor admitted the charges which include fraud.
Also, as a part of the settlement, three accounting and sales executive agreed to pay a total of $135,000 in penalties to settle individual charges. The Monsanto Company agreed to retain an independent compliance consultant, according to Wall Street Journal. Monsanto is pleased to have put everything behind them already and has assured to operate its business with utmost integrity and transparency.
There is no proper closure to the issue, as the Monsanto Company has decided only to settle without denying or accepting the charges against them. A settlement was only agreed with the parties involved.
