Hewlett-Packard, aided by auditor Ernst & Young, has found what it was looking for: proof that British firm Autonomy Corp., which HP acquired in 2011, was cooking the books. In a filing to U.K. regulators, HP said Friday that Autonomy had inflated revenues and made errors in accounting for certain employee expenses in 2010.

Because of the errors, HP reduced reported 2010 revenue at one Autonomy unit by 54 percent, according to Bloomberg. The unit’s operating profit was lowered by 81 percent. “Autonomy allegedly significantly inflated revenue for Autonomy Systems in 2010 by booking deals that were unlikely to be paid for, booking deals prematurely before they were closed, and even claiming transactions where there were no end customers,” according to a Wall Street Journal report that quoted an HP spokesperson. HP also found problems with the way Autonomy had accounted for employee commissions and bonuses.

“These restatements, and the reasons for them, are consistent with HP’s previous disclosures regarding accounting improprieties in Autonomy’s pre-acquisition financials,” an H-P spokesman said. “The substantial work necessary to prepare these accounts has revealed extensive accounting errors and misrepresentations in the previously issued 2010 audited financial statements, including the problems previously identified by HP.”

HP is cooperating with U.K. and U.S. regulators that are investigating the reporting errors, including the U.S. Justice Department. The allegations include disclosure failures and misrepresentations by Autonomy, before and during HP’s $11.1 billion buyout of the software company. A year after purchasing Autonomy, HP wrote down the value of the unit by $8.8 billion, sparking shareholder lawsuits.

Autonomy’s founder is denying HP’s latest claims.

Source: H-P Finds Accounting Errors at Autonomy Unit