US Navy contract knocks back EDS Q3 (again)

Let the new probe begin

By Ashlee Vance in Chicago • Get more from this author

Posted in Financial News, 4th November 2004 09:09 GMT

Free whitepaper – Blade learning lab and technical community

EDS has once again delayed the release of its third quarter results due to an ongoing account investigation and topped off word of the delay by announcing a new internal investigation into another matter.

EDS once planned to reveal third quarter numbers on Oct. 25 and then moved that announcement to Wednesday. Now it has delayed the earnings release again, as it continues to discuss the effects of a disastrous $8.8bn Navy contract with auditing firm KPMG. EDS will announce third quarter results once it has settled on when and how much it will write down as a result of the money losing Navy deal.

In addition to the earnings issue, EDS revealed that its audit committee has kicked off a new investigation related to the booking of quarterly bonuses in 2003 and 2004. KPMG notified the committee of the potential issues. EDS warned that the investigation could result in revised quarterly financial statements for 2003, but it doubts that such changes would significantly alter full year results.

It seems the fun never stops at EDS. The latest problems add to an ongoing probe by the US Securities and Exchange Commission and up to 20,000 job cuts. ®