Cay: Parmalat accounting is a fine fairy tale

Parmalat's operating units made a pre-tax loss of at least $435 million during the first nine months of last year, in contrast to the pre-tax profit of $375 million previously reported by management, the Financial Times reports. 

The difference between the pre-tax profit-and-loss figures appear to be fictitious financial transactions claimed by Bonlat, a Cayman Islands-based financial subsidiary.

The loss, detailed in a preliminary review by accounting firm PwC, could rise if investigators discover that Parmalat executives further padded sales and failed to account for numerous expenses and losses.

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