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Xerox accounting troubles may total $6bn

Xerox, the imaging hardware giant, today (Friday) insisted that it would only have to make a $2bn (£1.3bn) write down on its accounts, following reports that it faced a financial black hole of $6bn for the period 1997-2001.

Reports in the Wall Street Journal followed hard on the heels of the Enron and WorldCom scandals, but Anne Mulcahy, Xerox chairman and chief executive officer, insisted the firm's future was not at risk.

Xerox will file fresh accounts, which will "close a difficult chapter in the company's history", said Mulcahy. "We will have resolved the company's accounting issues with the Securities and Exchange Commission," she insisted.

Xerox ordered a re-audit of its accounts for 2001 following a US Securities and Exchange Commission (SEC) investigation into the company's 1997 to 2000 earnings.

Earlier this year it paid the SEC a fine of $10m as a settlement for previous accounting troubles.

In April Xerox signed a major document management system contract with Nationwide Building Society.

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