Linn Energy - accounting irregularities

As many of you probably already know, Linn Energy’s stock (NASDAQ:LINE) took an 18% dive yesterday as they reported that they were being examined by the SEC for accounting irregularities. I understand the Cliff Notes version / basic overview on why they are being investigated but can someone please break it down and tell me how these few analysts (from Barron’s, Hedgeye) came to these conclusions concerning these accounting irregularities. What were they looking at specifically in the financial statements? What was their thought process, etc? I am assuming it wasn't that obvious as some high profile people still backed the stock (i.e. Leon Cooperman, Jim Cramer) even after this initial criticism. I was just curious and want to learn more about understanding / evaluating financial statements (I have a science background). Thanks in advance and I hope everyone has a great 4th of July!

 

I think their practices have always been questionable. The accounting irregularities have to do deal with their business pitch which from what I understand is less volatile energy exposure!!! They basically hedge their energy production and don't expense the price of their puts and only show the end payoff which makes absolutely no sense. Adjusting their financials for this makes them look a lot worse.

 
Best Response

Repellat ipsam est voluptatem eaque aliquam. Nostrum quia molestiae corrupti iure molestiae odio. Aut nihil reiciendis exercitationem officia. Et repellendus et corrupti voluptates atque ut.

Labore repellendus officia vel ut omnis. Voluptate sequi eos dolore vel ea.

Career Advancement Opportunities

April 2024 Investment Banking

  • Jefferies & Company 02 99.4%
  • Goldman Sachs 19 98.8%
  • Harris Williams & Co. New 98.3%
  • Lazard Freres 02 97.7%
  • JPMorgan Chase 03 97.1%

Overall Employee Satisfaction

April 2024 Investment Banking

  • Harris Williams & Co. 18 99.4%
  • JPMorgan Chase 10 98.8%
  • Lazard Freres 05 98.3%
  • Morgan Stanley 07 97.7%
  • William Blair 03 97.1%

Professional Growth Opportunities

April 2024 Investment Banking

  • Lazard Freres 01 99.4%
  • Jefferies & Company 02 98.8%
  • Goldman Sachs 17 98.3%
  • Moelis & Company 07 97.7%
  • JPMorgan Chase 05 97.1%

Total Avg Compensation

April 2024 Investment Banking

  • Director/MD (5) $648
  • Vice President (19) $385
  • Associates (87) $260
  • 3rd+ Year Analyst (14) $181
  • Intern/Summer Associate (33) $170
  • 2nd Year Analyst (66) $168
  • 1st Year Analyst (205) $159
  • Intern/Summer Analyst (146) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Secyh62's picture
Secyh62
99.0
3
BankonBanking's picture
BankonBanking
99.0
4
Betsy Massar's picture
Betsy Massar
99.0
5
CompBanker's picture
CompBanker
98.9
6
GameTheory's picture
GameTheory
98.9
7
kanon's picture
kanon
98.9
8
dosk17's picture
dosk17
98.9
9
Linda Abraham's picture
Linda Abraham
98.8
10
DrApeman's picture
DrApeman
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”