CA admits error over deferred stock reporting

Incorrect information from Computer Associates led to five outside board members failing to disclose that they owned deferred...

Incorrect information from Computer Associates led to five outside board members failing to disclose that they owned deferred stock in the company.

The company, whose accounting practices are part of a federal probe, said in a statement this week that it did not think that outside directors needed to file "beneficial ownership" documents with the US Securities and Exchange Commission.

One of the five outside board members includes Richard Grasso, the head of the New York Stock Exchange.

"All director compensation has been fully disclosed in our annual proxy statements," CA said in a statement.

"Because director compensation is deferred until retirement, we and our directors did not believe that a Form 5 filing [a annual statement of beneficial ownership of securities] was necessary.

"We have recently been advised that such filings by our directors should be amended to comply and correspond with the proxy disclosure. This is a technicality, and in no way does this have any impact on the company's reported financials," the statement continued.

A CA spokeswoman said the company changed its decision on advice of its outside counsel, meaning Grasso and the other outside directors had to file ownership reports for this year and past years.

Grasso filed a report disclosing his ownership of 6,326 deferred shares of CA stock on 15 August, according to the CA spokeswoman.

The other outside directors are former US senator Alfonse D'Amato of New York; Shirley Strum Kenny, president of the State University of New York at Stony Brook; Roel Pieper, chairman of London-based Favonius Ventures; and Willem de Vogel, a partner at US equity firm Three Cities Research.

Grasso, who has served on the CA board since 1994, and three of the outside board members left the board yesterday. D'Amato is the only outside director remaining.

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