Micromuse to Fight Nasdaq Delisting

The software company seeks a hearing with the Nasdaq over delay in filing 10-K annual report.
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Micromuse

(MUSEE)

Friday said it is appealing the

Nasdaq's

decision to review whether the business software company should be delisted because of an internal accounting inquiry that delayed the filing of its 10-K annual report.

The San Francisco-based company announced the delay on Tuesday, adding that it will restate earnings for fiscal years 2000 to 2003 and incur about $2 million in "previously unanticipated professional fees and expenses related to the accounting inquiry."

The company said it had notified the Nasdaq and

Securities and Exchange Commission

about the reporting delay and requested a grace period in the hope of avoiding a potential delisting.

The company previously said the inquiry involves "the accounting for accrued expenses and expense recognition."

At the same time, the company raised its sales guidance for the first quarter of 2004. Micromuse now expects that revenue will be at "the high end of or slightly exceed our previously issued revenue guidance of $34 to $35 million."

Given recent events, the company's stock ticker has been changed to MUSEE from MUSE.

Recently, shares were down 20 cents, or 3%, to $6.70. The accounting announcement caused an initial selloff Tuesday, but the company's shares later recovered.