SCIENCE/TECHNOLOGY : Auditors’ Report Cites Doubts About MAI’s Ability to Keep Going

MAI Systems Corp., the struggling computer software company in Tustin, has not received a clean bill of health from its auditors, according to a document filed last month with the Securities and Exchange Commission.

Accounting firm KPMG Peat Marwick said in its audit that MAI’s recurring losses and working capital shortage, without some kind of external cash infusion or sales of assets, raise “substantial doubt . . . about the company’s ability to continue as a going concern.”

MAI posted a record $75.7-million loss on sales of $336.3 million for the fiscal year ended last Sept. 30. The company must come up with $82.6 million by March 10 to repay its current debt. Lenders have given the company extensions on the payments since October.

For the last two years, MAI has tried to adapt to changes in computer technology by shifting from manufacturing minicomputers to selling its software with computers made by other manufacturers. The strategy hasn’t worked so far, and MAI has laid off more than 1,000 employees in the last year, leaving it with 2,600 people.

Bert Weidberg, MAI senior vice president and general counsel, said the auditor’s comments are normal for a company with liquidity problems.

He said MAI is pursuing three alternatives: selling assets, obtaining additional financing and negotiating another extension on its repayment deadline.

“The company is not up for sale. We continue to explore all opportunities,” Weidberg said.