EDS delays third-quarter results

Electronic Data Systems is delaying the release of its third-quarter earnings until next Wednesday (29 October) to give the...

Electronic Data Systems is delaying the release of its third-quarter earnings until next Wednesday (29 October) to give the company auditors additional time to review its new accounting policy.

Spokesman Kevin Lightfoot said the auditors needed more time to implement an accounting policy under which EDS will change the way it reports revenue and costs on multiyear contracts.

Previously, 35% of EDS's revenue was accounted for under the "percentage of completion" (POC) accounting method, which allowed the company to report revenue for as-yet unbilled services, Lightfoot said.

After adopting the new rule, under which EDS will report revenue as it is billed and received, the company anticipates less than 5% percent of its revenue will be accounted for under the POC method.

EDS will also release data showing how its 2001 and 2002 earnings would have been reported under the new accounting method before it releases its third-quarter earnings. It will adjust its earnings for the first two quarters of 2003 to reflect the adoption of the new accounting policy.

Linda Rosencrance writes for Computerworld

Read more on IT outsourcing

SearchCIO
SearchSecurity
SearchNetworking
SearchDataCenter
SearchDataManagement
Close