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SNC-Lavalin Undergoes Voluntary Review

A review found discrepancies in a firm's financial reporting and internal cont

An international engineering and construction group based in Canada recently underwent an independent review of some of its payments, which were believed to be paid for one project but listed under another.

"Our policy is to maintain ethical standards in the conduct of our business

An international engineering and construction group based in Canada recently underwent an independent review of some of its payments, which were believed to be paid for one project but listed under another.

"Our policy is to maintain ethical standards in the conduct of our business and in our relations with whomever we associate," SNC-Lavalin said in its executive summary of the independent review. "Our integrity and reputation for ethical practices are among our most valued assets and are essential aspects of our sustained profitability."

In the press release, the company noted that information about discrepancies between payments and projects first surfaced in December 2011 and January 2012, and an independent counsel was hired in February to oversee the investigation.

The review is having some unintended consequences. Reuters reports that after the audit uncovered "material weaknesses in its internal control over financial reporting," chief executive officer Pierre Duhaime resigned.

As the news source points out, there had been some concerns that the strange payments and the civil war in Libya could negatively affect SNC-Lavalin's 2011 profit estimates. While the review announced on Monday showed there was no connection between the payments and Libya, the company had still lost about 20 percent of its market value earlier this month, Reuters says.

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