Whopper of the Week: WorldCom
Did we say "profit"? We meant to say "loss."
"Net income (loss)……………………..$1,407"
—WorldCom'sConsolidating Statement of Operations for 2001 (in millions), from WorldCom's 2001 10-K form as submitted to the Securities and Exchange Commission, Page F-46. (In plain English, WorldCom claimed a profit of $1.4 billion for 2001.)
"WorldCom, Inc. (Nasdaq: WCOM, MCIT) today announced it intends to restate its financial statements for 2001 and the first quarter of 2002. As a result of an internal audit of the company's capital expenditure accounting, it was determined that certain transfers from line cost expenses to capital accounts during this period were not made in accordance with generally accepted accounting principles (GAAP). The amount of these transfers was $3.055 billion for 2001 and $797 million for first quarter 2002. Without these transfers … the company would have reported a net loss for 2001 and for the first quarter of 2002."
—WorldCom press release, June 25.
Got a whopper? Send it to firstname.lastname@example.org. To be considered, an entry must be an unambiguously false statement paired with an unambiguous refutation, and both must be derived from some appropriately reliable public source. Preference will be given to newspapers and other documents that Chatterbox can link to online.
June 21, 2002: Terry Lynn Barton
June 14, 2002: Tom Ridge
June 7, 2002: Former FBI Deputy Director Weldon Kennedy
May 31, 2002: Ari Fleischer
May 23, 2002: Condoleezza Rice
May 17, 2002: Robert Mueller
May 9, 2002: Karl Rove
May 3, 2002: Gen. Richard Myers
April 25, 2002: Donald Rumsfeld
April 18, 2002: George W. Bush
April 11, 2002: The Rev. Robert J. Banks, archdiocese of Boston
April 5, 2002: George W. Bush
March 29, 2002: Major League Baseball
March 21, 2002: Billy Graham
March 14, 2002: INS commissioner James W. Ziglar
March 8, 2002: Robert Zoellick and the U.S. steel industry
Feb. 28, 2002: Al Sharpton
Feb. 22, 2002: Olympic skating judge Marie-Reine Le Gougne
Feb. 14, 2002: Kenneth Lay
Feb. 8, 2002: Enron spokeswoman Peggy Mahoney
Jan. 31, 2002: Monsanto
Jan. 24, 2002: Linda Chavez
Jan. 17, 2002: George W. Bush
Jan. 10, 2002: Simon & Schuster
Jan. 4, 2002: The Associated Press
(Click here to access the Whopper Archive for 2001.)
Timothy Noah is a former Slate staffer. His book about income inequality is The Great Divergence.