UTStarcom Warns of Possible Sarbanes-Oxley Delay

"Rules describing the requirements for the Company's independent auditors to be able to attest to the Company's compliance under Section 404 were adopted in June 2004 and the Company, along with its external service providers, are currently interpreting compliance requirements under Section 404," the company said in a Monday press release. "As a result of this uncertainty, as well as the control deficiencies noted above, UTStarcom cannot be certain that it will be able to comply with the requirements of Section 404 by the December 31, 2004 deadline."

The news comes as UTStarcom shares have been hard-hit in the summer's tech selloff. The company's stock traded north of $30 when it agreed in June to acquire Audiovox's (VOXX Quote) handset business. But it has slid since then, helped out in part by last month's soft second-half forecast.

Early Monday, UTStarcom rose 65 cents to $15.65.