Documentation and emails between HP and Autonomy reveal that senior executives at the US PC maker were well aware of the enterprise software firm's accounting practises, months before being exposed by a whistleblower.
HP, which accused Autonomy officials of accounting fraud, acquired it 2011 for $12bn, while a year later the PC maker was forced to take a write down of $8.8bn.
The Financial Times cited emails that Autonomy's sale of hardware to clients at a loss had been exposed in a paper trail documented by auditors, while a HP came to know about it only after the acquisition.
The publication also added that HP executives were involved in communications concerning Autonomy's hardware sales earlier than the whistleblower enlightened the issue.
HP said in a statement cited by Reuters that while it eventually came to know about the hardware sales, it did not know anything of the alleged accounting offensiveness until the whistleblower came forward.
"Our investigation has shown that Autonomy often resold generic hardware at a loss in the last few days of the quarter with the sole purpose of masking its real financial performance," the PC maker added.
"In addition, Autonomy engaged in improper transactions with certain value-added resellers to create the appearance of software licensing revenue at the end of each quarter.
"In some instances, these transactions were used to accelerate revenue, and on numerous occasions, these were fabricated transactions with no real end-user."
The latest exposure, if verified to be true, would wane the argument that Autonomy masked its accounts, in addition to the scheme that HP was not aware about the sales problems during the time of the deal.
HP's Autonomy acquisition has also been investigated by UK Serious Fraud Office SFO, the US Department of Justice (DOJ) and the UK Financial Reporting Council (FRC).
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