CA Investigation Leads to Firings

 
 
By Paula Musich  |  Posted 2004-04-19 Email Print this article Print
 
 
 
 
 
 
 

Computer Associates fires nine employees from its legal and finance departments due to problems that came out of the board of directors' audit committee investigation into CA accounting practices.

Computer Associates International Inc. Monday said it has fired nine employees from its legal and finance departments due to problems that came out of the board of directors audit committee investigation into CA accounting practices. Four employees from the legal department and five employees from finance were let go. CA would not reveal their names.
The audit committee is expected to wrap up its investigation soon, at which time it will reveal whether it believes CA is required to restate earnings from prior quarters according to the guidelines in the SECs Generally Accepted Accounting Principles. It is also expected to reveal the extent of the restatement it believes is required.
The audit committee had earlier found that CA had prematurely recognized revenue for software license contracts signed in a later quarter. For more on CA, read "Amid Turmoil, CA Moves Ahead." CA also said that it has formally responded to the Wells Notice that it received in January, notifying the company that the Securities and Exchange Commission was considering a civil enforcement action against CA.
In a prepared statement, embattled CA Chairman and CEO Sanjay Kumar characterized the firings as "remedial action" and said the company remains "focused on keeping our customers at the center of all that we are doing." CAs board of directors is expected to meet this week to discuss the investigation and other possible actions, according to sources close to the company. Check out eWEEK.coms Enterprise Applications Center at http://enterpriseapps.eweek.com for the latest news, reviews, analysis and opinion about productivity and business solutions.
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