Nortel Takes Tumble Over Tattered Books

Even so, Nortel's string of financial filing delays has run the company afoul of regulatory requirements, New York Stock Exchange guidelines and its credit agreements.

Last month, Nortel received its most recent waiver from its lender Export Development Canada, but that expires on Nov. 19. Nortel says it is seeking another waiver.

Nortel stumbled into accounting scandal early this year after internal audits revealed the company had overstated 2003 earnings by $300 million. Those bogus profits were central to a round of return-to-profit bonuses that a few observers flagged last year.

The disclosure was crucial because it drew a link between the company's controversial executive pay incentive plan and the recent accounting missteps. The link became clearer after the company fired its top execs, including former CEO Dunn. In August, Nortel fired an additional seven executives for their role in fluffing up the company's earnings, bringing the toll in the book-cooking scheme to 10.

Dunn was the company's CFO in 1999 and 2000, prior to his promotion to CEO. Dunn's attorney, Tom Heintzman, was unavailable for comment.

Nortel fell 25 cents to $3.33.

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