Struggling with an accounting scandal that forced its chief executive to resign, Computer Associates International Inc. said Monday it is restating financial results for 2000 and 2001 and confirmed it named Kenneth Cron interim chief executive.
The restatements concern $2.2 billion in revenue that was prematurely booked in 2000 and 2001, the company said.
More than a dozen Computer Associates executives have been forced out amid a federal probe into accounting fraud at the company, including former chairman and chief executive Sanjay Kumar, who resigned last Wednesday.
The adjustments have no effect on financial results for fiscal 2002 and 2003, as well as the first three quarters of fiscal 2004, the company said.
Computer Associates said the restatement doesn't change its net income for 2000, which remained at $696 million, or $1.25 a share. The amendment lowered revenue by $2 million to $6.092 billion for that year.
The restatement involves the movement of revenue from one quarter to another. A total of $1.78 billion was prematurely recognized in fiscal 2000 and $445 million in fiscal 2001, the company said.
The restatement narrows the company's fiscal 2001 loss by $333 million to $258 million, or 44 cents a share, from the previously reported loss of $591 million, or $1.02 a share. Its 2001 revenue increased $558 million from $4.19 billion to $4.75 billion.
"Computer Associates had a practice of prematurely recognizing revenue on software license agreements for several years prior to the company's adoption of its new business model in October 2000," said Walter Schuetze, a former chief accountant of the Securities and Exchange Commission who headed the internal probe by Computer Associate's audit committee.
The company said it will continue to fully cooperate with the government and is taking remedial actions and reviewing other steps to ensure this type of conduct doesn't happen again.
Separately, Computer Associates named Jeff Clarke chief operating officer. Clarke, 42 years old, joined Computer Associates as chief financial officer on April 1.
The company also named Greg Corgan senior vice president for worldwide sales. He succeeds Stephen Richards, who resigned.
Corgan, 50, joined the company last year as senior vice president for North American sales.