KINROSS GOLD CORPORATION ACCOUNTING SCANDAL

Company: Kinross Gold Corporation

Class Period: Feb-16-11 to Jan-17-12

Date Filed: Feb-20-12

Lead Plaintiff Deadline: Apr-20-12

Court: Southern District of New York

Allegations:

A securities lawsuit seeking class action status has been filed in the United States District Court for
the Southern District of New York on behalf of purchasers of the common stock of Kinross Gold
Corporation between February 16, 2011 to January 17, 2012.

Summary:

Kinross engages in mining and processing of gold ores in the America, Africa and the Russian
Federation. The Complaint names Kinross and certain of the Company’s officers as defendants, and
alleges that during the Class Period, defendants made materially false and misleading statements
concerning the Company’s business and prospects. Specifically, the Complaint alleges defendants
misrepresented and/or failed to disclose the following that: drilling results at the Kinross Tasiast
property had exhibited high amounts of low-grade ores and that the Company would, therefore,
need to modify its mining processes to help minimize operating costs and maximize profitability; as a
result of the foregoing, applicable accounting standards required the Company to record an
impairment in the value of goodwill that Kinross attributed to the Tasiast property; the Company's
financial statements were not fairly presented in conformity with International Financial Reporting
Standards and were, therefore, materially false and misleading; and defendants lacked a reasonable
basis for their positive statements about the Company, its business prospects and the Tasiast
property during the Class Period.
 XEROX CORPORATION ACCOUNTING FRAUD

Company: Xerox Corporation

Class period (fraud was committed): between 1997 and 2000

Date filed: April 11, 2002

Plaintiff: United States Securities and Exchange Commission

Court: United States District Court

Allegations:

U.S. Securities and Exchange Commission alleged that from at least 1997 through 2000, Xerox
Corporation ("Xerox") defrauded investors. In a scheme directed and approved by its senior
management, Xerox disguised its true operating performance by using undisclosed accounting
maneuvers -- most of which were improper -- that accelerated the recognition of equipment
revenue by over $3billion and increased earnings by approximately $1.5 billion.

Summary:

Xerox is a Stamford, Connecticut-based company incorporated in New York which manufactures,

sells and leases document imaging products, services and supplies in the United States and 130
other countries.

In 2002, the S.E.C (Securities and Exchange Commission) discovered that the Xerox Corporation had
been recording earnings on their income statements that weren’t attributed to a specific accounting
period, thus violating the revenue recognition principle. In order to carry out this scheme, Xerox
made use of two dishonest accounting practices: Cookie Jar Accounting and the improper recording
of long-term leases.

Cookie jar accounting connotes a company using periods of good financial results to create reserves,
hence the term “cookie jar”. Instead of recording these earnings immediately, the company saves
them to record on its financial statements at a later time. When the company then faces a period of
financial difficulty, it records these “cookie jar earnings” in its books., this tactic is employed in
order to dupe investors into thinking the company’s performance always meets their expectations.
This leads investors to give the company a high valuation, which in turn drives up the price of their
stock.

Xerox more frequently enters into long-term lease agreements in which customers pay a single
negotiated monthly fee in return for the equipment, service, supplies and financing. Xerox refers to
these arrangements as bundled leases and the monthly payment as "Total Cost of Ownership"
("TCO"). The improper recording of long term leases was done by reallocation of TCO leasing
revenue to the copier or other high cost equipment (known internally as "the box"). Under GAAP,
most of the fair market value of a leased product can be recognized as revenue immediately if
certain requirements are met, while non-equipment revenues such as service and financing are
recognized over the term of the lease. By shifting and reallocating revenues from finance and service
to the box, Xerox shifted revenues and earnings from future periods knowing that such reallocations
would negatively affect those future periods.

In final analysis, Xerox’s accounting practices for the recording of revenue were not only in clear
violation of one of the fundamental principles of the G.A.A.P, but were also completely dishonest as
they provided investors with the false idea that the corporation was constantly meeting earnings
objectives, thus violating the revenue recognition principle and compromising it’s own financial
statements. In order to carry out these fraudulent activities, Xerox made use of cookie jar accounting
and the improper recording of revenues from leases and rentals—two malicious accounting
practices allowing corporation to manipulate when specific revenues are recorded. After defrauding
millions of investors, Xerox was only fined a mere 10 million dollars—a slap on the wrist for such a
large corporation.

SYMBOL TECHNOLOGIES ACCOUNTING FRAUD

Company: Symbol Technologies (Subsidiary of Zebra Corporation)

Date filed: June 3, 2004

Class period (fraud was committed): from at least 1998 until early 2003

Plaintiff: Securities and Exchange Commission

Allegations:

The Securities and Exchange Commission charged Symbol Technologies, Inc. with securities fraud
and related violations of the reporting, record-keeping and internal control provisions of the federal
securities laws. The SEC also charged eleven former Symbol executives in connection with their roles
in the fraud. The SEC's complaint alleges that from at least 1998 until early 2003, Symbol and the
other defendants engaged in numerous fraudulent accounting practices and other misconduct that
had a cumulative net impact of over $230 million on Symbol's reported revenue and over $530
million on its pre-tax earnings.

Summary:

Symbol Technologies is an American manufacturer and worldwide supplier of mobile data capture
and delivery equipment. The company specializes in bar code scanners, mobile computers, RFID
systems and Wireless LAN infrastructure.

The defendants engaged in a fraudulent scheme to inflate revenue, earnings and other measures of
financial performance in order to create the false appearance that Symbol had met or exceeded its
financial projections. Defendant Tomo Razmilovic, Symbol's former president and CEO, and others at
the company fostered a "numbers driven" corporate culture obsessed with meeting Wall Street
estimates. With no regard for generally accepted accounting principles (GAAP) or their financial
reporting obligations, the defendants used the following fraudulent schemes to align Symbol's
reported financial results with market expectations: (a) a "Tango sheet" process through which
baseless accounting entries were made to conform the unadjusted quarterly results to
management's projections; (b) the fabrication and misuse of restructuring and other non-recurring
charges to artificially reduce operating expenses, create "cookie jar" reserves and further manage
earnings; (c) channel stuffing and other revenue recognition schemes, involving both product sales
and customer services; and (d) the manipulation of inventory levels and accounts receivable data to
conceal the adverse side effects of the revenue recognition schemes.