The Securities and Exchange Commission is contesting $400 million in ad revenue reported by AOL, according to the annual 10K report filed by AOL Time Warner on March 28.
The report says the SEC is contending that AOL improperly booked $400 million as ad revenue from a 2001 deal with Bertelsmann AG when the amount should have been identified as a reduction in the purchase price AOL paid for Bertelsmann's stake in AOL Europe.
AOL CEO Dick Parsons issued a memo to AOL staff last Friday saying the company stands by its treatment of the deals, according to Reuters.
The SEC is conducting an ongoing examination of AOL's accounting procedures due to allegations that AOL manipulated revenue to help close its mega-merger with Time Warner in January 2001.
