IBM accounting under fire

Some accounting specialists and analysts are raising questions about IBM Corp.'s (NYSE:IBM) accounting practices, specifically its treatment of one-time gains, the Wall Street Journal said. At issue is about $4 billion in gains IBM booked from the sale of its Global Network business to AT&T Corp. (NYSE:T) during its second and third quarters, the paper said. The gains were included in selling, general and administrative expenses, or SG&A, lowering reported costs and raising reporting operating income. In a new report, accounting watchdog Howard Schilit says IBM should be "roundly criticised for its policy of bundling one-time gains and other nonoperating activities into operating income," the Journal said. -- Reuters