Peregrine Will Restate Revenue, SEC to Investigate - TheStreet

Shares of

Peregrine Systems


rose Thursday after the software makerannounced it will restate financial statements for nearly three years andsaid it is being investigated by the

Securities and ExchangeCommission


Shares of Peregrine were up 14 cents, or 9.2%, to $1.67 in recent trading.

In a press release, San Diego-based Peregrine said it will restatefinancial statements for fiscal years 2000 and 2001 and the first threequarters of fiscal year 2002 based on information from an ongoinginvestigation into accounting errors and irregularities. As previouslyannounced, the company said the adjustments could total as much as $100million.

The SEC has launched a formal order of private investigation into thecompany's accounting practices, added Peregrine, whose software helpscompanies manage IT resources and other assets.

Peregrine said it is reviewing a range of steps to manage its expenses,including layoffs and financing alternatives. A company spokesperson wasnot immediately available for comment.

Shares of Peregrine fell to a 52-week intraday low of 73 cents earlier this month after the company said its board audit committee was launching an

internal investigation of potential accounting inaccuracies. KPMG, the independent auditors hired to replace Arthur Andersen in early April, brought the problems to the company's attention.

Peregrine said certain transactions involving revenue recognition irregularities of up to $100 million have been called into question and may have been recorded in fiscal 2001 and fiscal 2002. The transactions were recorded as revenue from the company's indirect channels and then may have been written off in later quarters.

At that time, the company's CEO and CFO resigned from the company.