A U.S. Securities and Exchange Commission (SEC) investigation into transactions conducted by graphics-chip maker NVidia likely focuses on how the company accounted for costs associated with its development of graphics chips for Microsoft's Xbox game console, a financial analyst said Friday.
On Feb. 14, NVidia officials revealed that the SEC has begun an investigation into how the company recorded reserves during the fourth quarter of its 2000 fiscal year and the first quarter of fiscal 2001. In addition, the SEC is investigating the possibility that US$3.6 million in product costs should have been recorded by the company during the first quarter of fiscal 2001, but were instead recorded during the second and third quarters of that same year, the company said. NVidia's fiscal 2000 year ended January 30, 2000 and its fiscal 2001 year ended January 28, 2001.
During a conference call with analysts on Feb. 14, Jen-Hsun Huang, NVidia's chief executive officer (CEO) and president, declined to comment on specifics of the SEC investigation, including the nature of the reserves under investigation.
News source: PC World
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