CA Inc. files its delayed 2006 annual report, completes internal

Long Island Business News, Aug 1, 2006 by Jean Paul Vellotti

CA Inc. said after the market closed Monday that it filed its delayed fiscal 2006 annual report and completed an internal review of its stock options program from 1996 to the present.

That review found fault with the software maker's options grants prior to fiscal year 2002. The company said that before 2002, a number of cases - mostly involving non-executive employees - delayed purchasing options for up to two years, a practice that CA said was changed in fiscal year 2002.

In delaying the purchase of options, CA found that in almost every case, the price at the time of exercise was lower than the value shares traded at when the options were awarded.

In June, when CA announced it would delay filing the report, the company said it most likely understated subscription revenue.

In the filing, CA restated its financial results from 2002 through 2005 and select quarterly information for fiscal years 2005 and 2006. In the restatement, CA said its final fiscal year 2006 subscription revenue was $20 million higher than previously recorded, rising to $3.8 billion.

Income from continuing operations was $156 million, or 3 cents per share, and operating earnings were also up 84 cents per share from the previous statement, up 3 percent from earlier figures.

A CA spokeswoman did not return calls for comment.

CA shares (NYSE: CA) were down 1 percent to $20.75 apiece in Tuesday morning trading.