A new report from the Financial Times suggests that senior management at Hewlett-Packard Company (NYSE:HPQ) knew about at least some of Autonomy’s irregular accounting practices six or seven months before they went public with the allegations.

Hewlett-Packard

Hewlett-Packard Company (NYSE:HPQ) acquired Autonomy in the third quarter of 2011 for $11.1 billion. Less than a year later, HP took a multi-billion dollar write down on the deal, saying sales were way below expectations. Then in mid-2012, a whistle-blower showed up who would testify that Autonomy hardware sales were often conducted at a loss. Hewlett-Packard eventually accused the firm of accounting fraud, and the case is currently under litigation.

Hewlett-Packard execs included in conversations

Autonomy’s practice of selling hardware at a loss was disclosed in a paper trail documented by auditors and a report was given to HP after the acquisition. Several e-mails revealed that Hewlett-Packard Company (NYSE:HPQ) execs had been included in conversations regarding the hardware sales problems well before the whistleblower brought the issues to public attention.

Hewlett-Packard Company (NYSE:HPQ) CEO Meg Whitman was copied on an e-mail sent in October 2011 when Autonomy discussed the difficulties it was having selling hardware, according to the publication. This evidence seems to contradict Hewlett-Packard’s earlier statements, where it said it eventually learned about the hardware sales but knew nothing about the accounting issues until the whistle-blower came forward a year later. The emails would indicate HP management knew about the hardware sales issues at least six or seven months before it made the allegations public.

Autonomy CEO statement

In response to the new report, Autonomy CEO Mike Lynch told the Financial Times that the emails they uncovered demonstrate that Hewlett-Packard’s allegations of accounting fraud and a lack of transparency are inaccurate. Lynch said, “Meg Whitman accused Autonomy of ‘active concealment’, but these revelations prove we were open and transparent with our auditors who continue to stand by the accounts.”