Despite efforts by the Securities & Exchange Commission (SEC), many Fortune 1,000 companies have failed to disclose the cost of their year 2000 fixes, according to a study by Weiss Ratings, which offers Y2K readiness ratings on US corporations.
SEC guidelines require public companies to disclose their total estimated Y2K budgets and current Y2K spending, Weiss Ratings said. But many companies are only reporting partial information or none at all. For example, IBM said its estimated Y2K budget is $575 million and Hewlett-Packard reported $250 million, but neither company provided information on actual expenses, the Palm Beach Gardens, Florida.-based company said.
It said Bristol-Myers Squibb, Dell Computer, Enron, Merck & Co., Microsoft and Sysco didn't provide actual Y2K costs and budget estimates. They also failed to disclose this information in their 10K or 10Q mandatory SEC filings in 1998 and 1999, Weiss Ratings said. In addition, Weiss Ratings hasn't obtained complete Y2K costs from public documents for 41 of the Fortune 500 companies, the company said.
Most of the Fortune 1,000 companies, whether they made full disclosure or not, include standard language in their financial statements, saying Y2K costs are "not material," Weiss Ratings said. But according to the SEC, Y2K issues are "likely to be material," the company said.
Some of the companies that failed to completely disclose their Y2K budgets and costs include Bristol-Myers Squibb, Cisco Systems, Computer Associates International, Hormel Foods, IBM, Microsoft, the New York Times, Dell Computer, EMC, the Gillette, Hilton Hotels, Oracle, Silicon Graphics and Tyco International, Weiss charged.
SGI spokeswoman Noreen Lovoi said the company doesn't track Y2K expenses by numbers, but that doesn't mean Y2K isn't important. "We expect to be fully compliant by year's end," Lovoi said. The company included Y2K information in its March 10Q.
Meanwhile, a Dell spokeswoman said the company reports everything the SEC wants for investors on its Web site.
Other companies, including Microsoft, EMC, Oracle, Cisco and IBM, didn't return calls by press time.