Auditing

CA’s Examiner ExtendsTerm

But if company is in compliance by May, DoJ will seek the court's dismissal, with prejudice, of the information filed against CA.
Stephen TaubSeptember 15, 2006

CA officials have said the U.S. Attorney’s Office has extended the term of the company’s independent examiner to May 1, 2007, partly due to changes in the company’s finance department. The independent examiner’s term was scheduled to expire on September 16, under the original terms of CA’s Deferred Prosecution Agreement (DPA) finalized in September 2004.

The software giant, formerly known as Computer Associates, noted in its announcement that all involved parties — including the U.S. District Court, Eastern District of New York; the U.S. Attorney’s Office; the Securities and Exchange Commission; the independent examiner; and CA — agreed that the extension was appropriate “given the control environment and commission-related material weaknesses” announced by the company for the fiscal year ended March 31, 2006.

CA also cited issues concerning the reorganization of its finance department, which will be addressed by the company’s new chief financial officer, Nancy Cooper, who took over on August 15. During the extension period, the independent examiner intends to focus primarily on issues related to material weaknesses and the reorganization, CA noted.

Drive Business Strategy and Growth

Drive Business Strategy and Growth

Learn how NetSuite Financial Management allows you to quickly and easily model what-if scenarios and generate reports.

The company stressed that except for the control issues, the U.S. Attorney’s Office advised the court that CA has, to date, substantially complied with the terms of the DPA. In fact, if the control issues are resolved by May 1, 2007, or earlier, and CA is in compliance with the DPA, the government “will seek the court’s dismissal with prejudice of the information filed against CA shortly after the [independent examiner] issues his final report,” noted U.S. Attorney Roslynn Mauskopf in a letter to I. Leo Glasser, the district judge hearing the case. In addition, Mauskopf wrote that the SEC also will evaluate CA’s compliance with the civil final judgment at that time.