CA executives asked to resign over past accounting practices

Three senior executives at Computer Associates International have been asked to leave the company in an investigation over past...

Three senior executives at Computer Associates International have been asked to leave the company in an investigation over past accounting practices.

Sanjay Kumar, CA's chairman and chief executive officer, requested the resignations in response to preliminary results from an internal investigation of the accounting issues.

CA has received resignations from Ira Zar, chief financial officer; Lloyd Silverstein, senior vice-president of finance and David Rivard, vice-president of finance.

An external search for a new chief financial officer will begin immediately. Douglas Robinson, CA senior vice-president of finance, will fill the position in the interim.

CA has been facing two federal probes into its revenue recognition practices. The company has also established an audit committee to investigate the matter internally, led by a former chief accountant at the US Securities and Exchange Commission, Walter Schuetze.

Initial results have revealed a number of software contracts in the 2000 financial year that "appear to have been signed after the end of the quarter in which revenues associated with such contracts had been recognised. Those revenues should have been recognised in the quarter in which the contract was signed", Schuetze said.

The value of the contracts were not disclosed. CA said it has informed government investigators of its findings, while its audit committee will examine whether the company needs to restate past financial results.

James Niccolai writes for IDG News Service

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