Peregrine Systems

(PRGN)

is moving on to its third independent auditor intwo months.

The San Diego-based company said Monday it has fired auditor KPMGbecause about one-third of the $100 million in revenue that the software makermust restate involved transactions with the accounting firm or KPMGConsulting. Peregrine lists KPMG Consulting among the system integrators and consultants that sell Peregrine products.

In a press release Monday, Peregrine said it believes that thesetransactions, totaling $35 million, compromise auditor independencerequirements mandated by the

Securities and Exchange Commission

.Peregrine said its decision to fire KPMG was not the result of anydisagreement on accounting principles or practices, financial statementdisclosure, or auditing scope or procedure.

Peregrine has retained PricewaterhouseCoopers to continue and completean internal investigation previously begun by KPMG. Peregrine has launcheda search for new independent auditors and begun discussions with candidatefirms.

After Peregrine replaced Arthur Andersen in April as its auditor, KPMG discovered potential accounting inaccuracies that led the company to restate revenue.

Previously, Peregrine said it recognized revenue from indirect channels and then may have written off that revenue in later quarters. Last week Peregrine, whose software is used to manage IT resources and other assets, announcedit is under investigation by the SEC.

Shares of Peregrine plummeted to a 52-week intraday low of 73 centsearlier this month amid its accounting woes. Shares fell 8 cents, or 4.9%,to $1.58 in recent trading.