Database company Informix Corp, which has seen its fair share of financial trouble and shareholder lawsuits, has announced it is changing accountants. Informix has dismissed Ernst & Young LLP and says it is in the process of engaging KPMG Peat Marwick LLP as its next independent accountant. The company said it wasn’t revealing the reasons for the switch but that they would be made public in the requisite 8K filing with The Securities and Exchange Commission, which will be made within the next five days. Chances are it has a lot to do with the screw-up that led the company to announce last September that it would have to restate up to $250m of earnings for the fiscal years 1995 and 1996 (CI No 3,252). The restatement resulted from the discovery of errors and irregularities in the recording of revenue. At the time, the company admitted that revenue was booked in many cases when a commitment of sales and marketing activity by Informix to resellers was still outstanding. Some of the transactions were contingent upon sales to end users and, said Informix, some revenue was booked too early and some should never have been booked at all. Thus there was some revenue shifted from quarter to quarter and some that disappeared altogether. Unfortunately for Informix, switching to a new firm doesn’t guarantee a departure from those all-too-familiar old numbers. The Menlo Park, California-based company lost $357.2m in fiscal 1997 and $73.6m in 1996. It recently surprised Wall Street with a profit of $7.1m, or $0.03 per share, for its first quarter (CI No 3,401).
