Monday's surprise announcement that CA (CA) - Get Report is losing yet another top executive is worrying investors who appear to be growing tired of waiting for the software giant's stock to recover and lending ammunition to the company's persistent critics.

"CA needs to convince shareholders that it really has made a fresh start," says Con Hitchock, outside counsel and spokesman for Amalgamated Bank LongView Funds, a holder of CA shares. "The revolving door isn't doing the trick."

The departure of CFO Robert Davis comes a week after CA's chief technology officer, Mark Barrenechea, left to joint a venture-capital company. Jeff Clarke, who was chief operating officer, left for a position at

Cendant

(CD)

on April 18.

Later that month, the company reported fourth-quarter earnings and revenue that badly missed Wall Street forecasts due to weak products sales, ballooning sales commissions and an apparent miscalculation by Davis that likely cost him his job.

And all of that follows a guilty plea by former CEO Sanjay Kumar to charges of fraud and obstruction related to a $2.2 billion accounting scandal.

The turmoil hasn't helped the company's stock. In recent trading, shares were off 95 cents, or nearly 4%, to $23.48. But more important than any short-term fluctuations is the stock's dismal long-term performance, says Hitchcock. Over the last 10 years, the stock has lost about 25% of it value, while the

S&P 500

has appreciated by 97%.

Davis, who will step down under a "mutual agreement," will be replaced by corporate controller Robert Cirabisi, who joined the Islandia, N.Y., company in 2000. And that bothers Gary Lutin, an investment banker who has been running an online forum for CA shareholders. "The person who has been given CFO status was there during the period of admitted fraud. That can't inspire much confidence among investors and raises real serious questions about what the board of directors is thinking."

Hitchcock of LongView has been critical of the company's recovery efforts for some time and would like to see the board's longest-tenured members replaced because, he claims, they did not exercise sufficient oversight. The rest of the board has already been replaced, along with the management cadre that worked closely with Kumar and founder Charles Wang.

CA is resisting the effort by LongView to remove the directors. A decision by the

Securities and Exchange Commission

on whether the matter can come to a shareholder vote is not expected until July.

In repeated interviews and public appearances, CA executives have stressed that since the scandal, the company has put in place strong internal accounting controls. But critics say the announcement that CA would miss its fourth-quarter targets calls their efficacy into question.

Here's why. The company made a number of acquisitions in calendar 2005, including software vendors Niku and Concord. Before being acquired, the companies had a fairly standard revenue model in which they sold software licenses and recognized the revenue up front. CA, though, has a complex subscription model in which revenue is recognized ratably, i.e., a bit at a time over the life of a contract.

As the companies were blended into CA, salespeople and customers negotiated to find the most advantageous terms. In the end, more contracts than CA expected were signed on what the industry calls "CA paper" -- the larger company's business model. And that meant revenue that would have been recognized in the fourth quarter won't be recognized until some future date -- thus, the miss.

It's worth noting, however, that the revenue isn't lost. It's merely postponed.

But that raises the question of why the company didn't know that much sooner. And it appears that the blame for the miscalculation is falling on Davis.

As if those problems weren't enough, analysts also worry that the company isn't moving fast enough to diversify itself beyond its core strength in mainframe software.

Credit Suisse analyst Jason Maynard reiterated an underperform rating Monday, saying, "Our primary thesis is that the mainframe is continuing to struggle, which will likely continue to affect CA's business. We view the recent management turnover as yet another issue for the company to resolve, which will only serve to prolong the turnaround." Credit Suisse has an investment-banking relationship with CA.