Few companies have had quite as loud a wake-up call over lax financial controls as Computer Associates International Inc., the $3.5 billion management software producer. A massive accounting scandal involving fraudulent revenue recognition practices between

1998 and 2000 led to a settlement with federal prosecutors last year, including $225 million in shareholder restitution payments. During the last year, the Islandia, N.Y.-based company took another $40 million in restructuring charges, shed 5% of its workforce and restated nearly three years of financial results. When it came time to report on year one of Sarbanes-Oxley compliance in June, the bad news kept coming. Management identified two material weaknesses related to ineffective controls over accounting for software contract credits and at certain regional overseas operations.

So you could say Robert Davis, CFO at CA since February, has his work cut out for him. A former vice president for corporate finance and chief accounting officer at Dell Inc., Davis' mission involves not only fixing the control environment around financial reporting, but within an improved compliance framework, getting Computer Associates back on firm financial ground.

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