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Google stashes $500m for fines
Certain that any verdict won't hit profits
Google has set aside $500m to settle the investigation into its advertising practices by US regulators.
The Department of Justice is examining allegations that Google's advertising practices are anti-competitve. The Chocolate Factory made 97 per cent of its revenue from advertising in the first three months of 2011.
The filing says: "In May 2011, in connection with a potential resolution of an investigation by the United States Department of Justice into the use of Google advertising by certain advertisers, we accrued $500m for the three-month period ended March 31, 2011. Although we cannot predict the ultimate outcome of this matter, we believe it will not have a material adverse effect on our business, consolidated financial position, results of operations, or cash flows."
The SEC filing also warns that Google is under investigation in Europe and South Korea for similar allegations. Google's Form 10-Q warns: "We are subject to increased regulatory scrutiny that may negatively impact our business."
The advertising giant is also under investigation by the Environmental Protection Agency in the US for releasing refrigerant from a data centre it bought from DoubleClick, the filing revealed. ®