Amid concerns of accounting impropriety raised by independent auditor KPMG, Peregrine Systems Inc. CEO and CFO resigned.
Amid concerns of accounting impropriety raised by independent auditor KPMG, Peregrine Systems Inc. CEO and CFO resigned Monday morning.
Steve Gardner, chairman of the board and CEO, and Matt Glass, CFO, executive vice president of finance and also a director on Peregrines board, relinquished their positions after the audit committee of the board was authorized to conduct an internal investigation into potential accounting inaccuracies.
Peregrines board appointed Rick Nelson as acting CEO, Fred Gerson as action CFO and John Moores as its new chairman. Gerson serves as the CFO of the San Diego Padres while Moores has been a member of Peregrines board since 1989.
KPMG was engaged by Peregrine in April to replace Arthur Andersen LLP for the audit of the companys recently completed fiscal year.
Preliminary findings show revenue recognition irregularities totaling as much as $100 million for the provider infrastructure management software. The irregularities would have been reported in fiscal years 2001 and 2002, according to Peregrine officials in San Diego, Calif.
The transactions in question were recorded initially as revenue from Peregrines indirect channels and may have been written off in later quarters, officials said.
The channel transactions, along with other accounting matters under investigation, could impact financial results for fiscal 2002 and prior quarters.
In 2001, BusinessWeek named Peregrine as one of the 100 best performing IT companies.