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UTILICORP ANNOUNCES $11.6 MILLION CHARGE AGAINST EARNINGS AND LEGAL ACTION

UTILICORP ANNOUNCES $11.6 MILLION CHARGE AGAINST EARNINGS AND LEGAL ACTION
    KANSAS CITY, Mo., June 15 /PRNewswire/ -- UtiliCorp United (NYSE: UCU) today announced that it is taking a one-time $11.6 million pretax charge ($7.4 million after taxes) against earnings in the second quarter as a result of recent findings during an investigation by its internal audit staff and independent investigations by its outside legal counsel and its outside auditors.  The charge will reduce second quarter primary earnings per average common share by $.21.
    The investigations revealed that approximately $11.6 million was apparently misappropriated during the course of certain transactions by Aquila Energy Resources Corporation to acquire oil and natural gas properties.  Aquila Energy Resources is an indirect subsidiary of UtiliCorp.
    In addition, further possible losses of approximately $6.1 million ($3.9 million after taxes) have been identified in the investigation. An additional charge against earnings may result if these are determined to be probable losses.  The facts to date have not shown that this charge is appropriate.
    The investigations centered primarily around improper payments by former employees of Aquila Energy Resources in connection with the purchase of natural gas and oil properties located in Texas, Oklahoma and offshore in the Gulf of Mexico.
    UtiliCorp Chairman and President Richard C. Green, Jr., said:  "It is unfortunate that we had a few people at Aquila Energy Resources who abused the authority they were granted.  We are chagrined that these actions occurred.  We view them with extreme seriousness.  We are taking action to ensure that they never happen again."
    UtiliCorp will pursue civil action to recover damages and also file claims to recover approximately $4 million through insurance coverage. The findings of its continuing investigation will be reported to the proper government authorities, including the United States Attorney's office.
    Changes in procedures and organizational reporting have been implemented at Aquila Energy Resources' Houston office, where the problems occurred, and at Aquila Energy Corporation's headquarters office in Omaha.  John R. Baker, Vice Chairman of UtiliCorp, has been assigned to provide corporate management support to Aquila.
    Based in Kansas City, UtiliCorp provides gas and electric service to nearly a million customers in eight states and the province of British Columbia.  The company also is engaged in various non-regulated energy and utility-related enterprises.
    -0-             06/15/92
    CONTACT:  Ed Muncaster or Phil Hermanson, both of Utilicorp, 816-421-6600
    (UCU) CO:  UTILICORP UNITED IN:  OIL ST:  MO -- MN003 -- X506  06/15/92
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Publication:PR Newswire
Date:Jun 15, 1992
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