EDS Requests More Time To File 3Q Report

EDS said Tuesday it would ask the SEC for a five-day extension, until Nov. 15, so it can settle a dispute with outside auditors KPMG over a money-losing contract to build a network for the Navy.

The company, which runs computer systems for other companies, faced a Tuesday deadline to file the financial report.

The Navy deal has been estimated to produce $8.8 billion in revenue over several years, but the company has lost more than $1 billion on it so far, and the work is far behind schedule.

EDS is expected to take a charge against earnings to reflect lower value to the Navy contract, but it hasn't put a figure on the revision. It has said assets involved in the deal are worth $700 million.

One analyst estimated last week that EDS could take a charge against earnings of $370 million for the quarter ended Sept. 30.

Plano, Texas-based EDS also disclosed last week that it hired a law firm to look into the timing of money set aside for bonus payments to employees last year.

The shares fell 17 cents, to $20.98, in trading Tuesday on the New York Stock Exchange, before news of the request for more time to file the document, known as a 10Q.

Through the delays in filing its financial results, EDS has maintained that third-quarter earnings--excluding special items such as a write-down of the Navy contract's value--would range from 5 cents to 10 cents per share.

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