Nortel Delays Filings Again

The company finds more accounting missteps.
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Nortel

(NT)

sank 6% Thursday after the company's accounting mess grew even murkier.

The Brampton, Ontario, telecom gearmaker delayed once again its planned restatement of previous financial results and its release of third-quarter earnings. Nortel put off the filings after it unearthed its latest round of accounting missteps.

The company said it has located some $3.1 billion in revenue that was misbooked in 1999 and 2000, including $250 million in revenue that will be "permanently reversed." Nortel said the balance of the revenue adjustments in 1999 and 2000 will be deferred and recognized in subsequent years.

"In the course of the Company's reviews over the last two weeks, we have found a level of revenue restatement which warrants that we undertake a deliberate, focused but bounded double-checking of several revenue areas," CEO Bill Owens said. "We have taken this decision to postpone our filings as a prudent measure to take the steps needed to ensure that we have captured all necessary corrections and adjustments in our restated results."

Nortel said it hopes to file third-quarter numbers by the middle of next month and to finalize its restatement of previous results by mid-January. The company said the latest delay could put it in default with some lenders and that it could face delisting by various stock exchanges.

Early Thursday, Nortel dropped 17 cents to $3.41.

Scott Moritz writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He invites you to send your feedback to

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