Computer Associates Offers Settlement

Computer Associates International Inc. has offered the government $10 million to settle a probe into its accounting, the company revealed in its earnings report Tuesday.

The Islandia, N.Y.-based software giant said it did not know whether the settlement offer would be accepted or whether the company eventually would be forced to pay more. The company’s accounting has been the focus of a probe by the Justice Department and Securities and Exchange Commission, and led to the ouster of Chief Executive Sanjay Kumar.

CA reported net income of $89 million, or 15 cents a share, for its fiscal fourth quarter ended March 31, contrasted with a loss of $106 million, or 18 cents, in the same quarter last year.

Excluding items, CA earned 18 cents a share in the fourth quarter, compared with 8 cents a year earlier.

Sales climbed 9.7% to $850 million. Subscription revenue rose to $535 million from $395 million, as the company continued to move to a more subscription-driven business model.

Analysts polled by Thomson First Call on average expected the company to earn 17 cents a share on sales of $862.8 million.

Originally scheduled to report results May 12, CA announced earlier this month that it would have to delay reporting results for the fiscal fourth quarter and fiscal year because its staff was overburdened by an accounting restatement.

After the ouster of the CEO in the accounting scandal, CA appointed board member Kenneth Cron as interim chief but is still searching for a permanent CEO as well as a chief financial officer.

Its New York Stock Exchange-listed shares were unchanged Tuesday at $25.70. In extended trading, after the release of the results, the shares were down 80 cents, or 3.1%.