Comverse stock in freefall following new accounting errors

NEW YORK-The troubles continue to mount for wireless technology provider Comverse Technology Inc., as the company announced it identified errors in the “recognition of revenue related to certain contracts, errors in the recording of certain deferred tax accounts and the misclassification of certain expenses in earlier periods.”
The company also said its executives may have misused reserves and understated backlogs in 2002 and earlier.
Angry investors sent the company’s stock down almost 15 percent to $17.65 per share following the news. Three investment banking firms also downgraded their opinion of Comverse’s stock.
“The company continues to work diligently to complete its investigation and report restated financial results as promptly as possible,” said Raz Alon, the company’s interim chief executive officer.
Comverse has suffered a number of financial stumbles in recent months due to accounting and stock-option troubles. Indeed, the problems were such that the company’s former CEO fled the country, only to be captured later hiding in Namibia.