Updated from 5:16 p.m. EDT

CA (CA:NYSE) hit its reduced financial targets for the fourth quarter, but yet again announced that it is delaying the filing of its annual report, or 10-K, because of a batch of newly discovered accounting issues.

CA also issued fiscal-year earnings guidance well below Wall Street's expectations, and the company said a problem with the accounting of stock options could cost shareholders as much as $540 million.

"We are disappointed that we cannot file our 10-K to meet the extended deadline and that we continue to find problems associated with CA's past," said company CEO John Swainson.

"However, delaying the filing is our only option until we understand the full impact of the legacy stock option issue and any potential financial adjustments," he said in a press release.

"These issues are about our past, and not our future, and we continue to focus on building the company."

The options issue does not appear to be similar to the backdating scandal that has rocked other companies, but the bill for the errors could be high. According to CA, there were delays of as much as two years from the date that employee stock options were approved by the board and the date such grants were communicated to employees.

The problems took place between 1997 and 2001. A preliminary estimate by the company put the potential cost at something less than $40 million total for 2005 and 2006, and $40 million to $100 million per year for the 2002 through $2004 on a pre-tax basis. Options issued between 1997 and 2002 will have a pretax impact "in excess of $200 million," the company said.

Additionally, CA said it may have understated subscription revenue by about $40 million in total during fiscal years before 2006. As the company makes adjustments, it will reduce subscription revenue through around 2011, it said.

Investors have gotten used to bad news from CA; in after-hours trading on Instinet, shares were off a modest 54 cents, or 2.6%, to $20.23.

The business-software company reported a loss of $36 million, or 6 cents a share, from continuing operations, compared with the year-ago profit of $16 million, or 3 cents a share, on the same basis. Revenue was up 3% to $947 million.

On a non-GAAP basis, the company earned the expected 14-cent-a-share profit.

The company said it will no longer give quarterly guidance. For the next fiscal year, it now expects to post a non-GAAP profit of 83 cents a share on sales of $3.9 billion in fiscal 2007. Analysts polled by Thomson First were looking for a profit of $1.05 a share on sales of $4.05 billion. On a GAAP basis the company said it expects to earn 44 cents a share, but Swainson said on a conference call that the GAAP number could be lower.

Thursday's filing delay was just one in a string of similar announcements. Citing accounting problems related to commission expenses and other matters, CA in April and then again in late May delayed the 10-K and reduced top- and bottom-line guidance. It also delayed the release of fourth-quarter and full-year financial results.

CA, which used to be called Computer Associates, is still struggling to shake off the shadow of the $2 billion accounting scandal that brought down former CEO Sanjay Kumar and other top executives, several of whom have pleaded guilty to charges of fraud and related felonies.

Separately, CA also announced that its board of directors has authorized a new stock repurchase plan that enables the company to buy $2 billion of its common stock in its current fiscal year ending March 31, 2007.

The company also said that it has named 30-year industry veteran James Bryant to the new position of executive vice president and chief administrative officer. Bryant's appointment is immediate, and he reports directly to Swainson.

There is no charge for participation.  As stated in the Conditions of Participation, participants are expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

Inquiries and requests to be included in the Forum's distribution list may be addressed to ca@shareholderforum.com.

The material presented on this web site is published by Gary Lutin, as chairman of the Shareholder Forum.