Tech firm’s chief speaks out on accounting scandal

Kevin Rademacher

Monday, May 24, 2004 | 10:48 a.m.

Introductions were the first order of business for Kenneth Cron as tech giant Computer Associates' annual Las Vegas convention got under way Sunday night.

Cron, the new chief executive of the Islandia, N.Y., company, was appointed less than a month ago, along with several other new top executives, amid the fallout from an accounting scandal that has dogged the company for months.

In the opening keynote speech at CAworld, Cron told thousands of employees, customers and analysts that the company was putting its troubled past behind it and looking to the future.

"CAworld marks the beginning of a new chapter for this company," Cron said.

The balance of the nearly hourlong speech was dedicated largely to emphasizing an often-repeated pledge to focus on customer service.

Computer Associates touts itself as the world's leading manufacturer of management software, which is designed to integrate a variety of autonomous programs and platforms companies buy from many different vendors.

Cron said that an internal investigation into the company's accounting irregularities is complete and that he expects a federal investigation to wrap up soon.

The Department of Justice and the Securities and Exchange Commission are investigating the company's finances. The company also said it would restate more than $2 billion in revenue from 2000-2001. Cron replaced Sanjay Kumar, the company's popular former chief executive, who the board of directors pushed aside in April. Kumar now serves as chief software architect.

"With that said, we are a company of strength," he said. "A company of financial strength, technological strength and strength in products."

As customers wandered through the event's exhibit hall following Cron's speech, there were mixed reactions to the CA management change or accounting scandal.

Muhammad Sheikh, a systems engineer with Fidelity Investments in Boston, said his company initiated a new contract with CA in January despite the news of scandal.

"We're just going to keep going," Sheikh said. "We've been working with CA for a long time. We're very close to CA."