An article in the latest edition of Barron’s has questioned the accounting practices of hospital giant HCA.
According to the article’s authors, father and daughter CPAs Abraham J. Briloff and Leonore A. Brillof, the Nashville-based company during its 2006 leveraged buyout and its initial public offering earlier this year employed accounting practices functionally equivalent to pooling-of-interest, which the Financial Accounting Standards Board forbids.
The article, which offers a thorough explanation of its claims, says that using that method allows HCA to mask various charges by keeping them off the books. HCA officials quoted in the article dispute the authors’ characterizations and maintain that the deals were heavily reviewed and were in line with general accounting practices.
The company’s stock (Ticker: HCA), which has struggled of late alongside much of the health care sector, remained flat for much of the morning but has subsequently fallen by more than 5 percent during the middle of the day. Since its IPO in March, it has fallen almost 40 percent.