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Why Investors Shouldn't Trust Companies With Accounting Errors

Timothy Anderson, managing director at TJM Investments, warns investors to be cautious when it comes to companies that have accounting errors. In this case, the company to be wary of is Real Money's Stock of the Day Kraft Heinz , which received a subpoena from the Securities & Exchange Commission (SEC). Related. Kass: Will Kraft Heinz Be an Investment Call to Arms by Warren Buffett? Kraft said it had received a subpoena in October "associated with an investigation into" its accounting policies, procedures and internal controls related to its "procurement function." This includes "agreements, side agreements, and changes or modifications to its agreements with its vendors," the company said. "Following this initial SEC document request, the Company together with external counsel launched an investigation into the procurement area." Related. Kraft Heinz Crashes to Lowest Level of Buffett Era "We continue to cooperate fully with the SEC and at this time the Company does not expect matters subject to the investigation to be material. For context, this $25 million increase to costs of products sold compares an annual procurement spend of over $11 billion annually for the total company," Kraft Heinz spokesman Michael Mullen told TheStreet in an email. This video was originally published by TheStreet.

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