Monsanto Agrees to $80 Million Settlement Over Misstated Earnings
Global agrochemical giant Monsanto has agreed to pay $80 million to settle claims it misstated earnings for its popular Roundup weed killer. A spokesman for the US Securities and Exchange commission said that three executives have also agreed to settlements over the charges. The investigation was launched in connection with Monsanto's rebate program, designed to stop the bleeding as generic competitors launch cheaper alternatives to Roundup. SEC officials noted that the company did not have adequate accounting practices in place to account for the rebates, so the company ended up reporting solid revenue for Roundup products, but failed to account for the cash it paid out in rebates. As a result, the SEC noted, Monsanto's earnings were materially misstated for each of the last three years.
"Public companies need to have robust systems in place to ensure that all of their transactions are recognized in the correct reporting report," read a statement from the SEC”s associate director of enforcement. As is ususually the case when companies settle with the SEC, Monsanto did not admit to any wrongdoing as part of the settlement. The SEC also reached an agreement with former Monsanto sales executive, Jonathan Nienas, as well as accounting executives Sara Brunnquell and Anthony Hartke. In addition, Brunnquell and Hartke have been temporarily prohibited from acting as accountants for publicly traded companies.