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BakBone Slips Again

BakBone Software Inc. (Toronto: BKB) CFO John Fitzgerald says the company has nothing to hide, even though the CEO revealed today that accounting problems could drag on until June.

In an open letter to customers, shareholders, and partners, BakBone CEO Jim Johnson said the accounting problems could take another five months to clear up. The letter says the latest delay is due to a review to determine whether income should be counted as licensing revenue or maintenance revenue. What we do know at this point is that the analysis and review could take as long as five months, or until the end of June,” he writes.

Following up with Byte and Switch today, CFO Fitzgerald says five months is a "worst-case scenario." Still, he notes, a lot of people have assumed the worst, as BakBone's accounting mess has gone on since May.

"Frankly, we've had quite a bit of pressure from customers, partners, and the competition saying these guys are going out of business," he says. "People have said, 'Tell us something, what's going on with the company? Maybe you're trying to hide something.' And that's completely not the case. We have nothing to hide."

So what is going on? BakBone has not filed earnings reports for its last two quarters, and the company is in the process of restating its audited fiscal year 2004 financial statements (see BakBone Needs to Restate). Trading of BakBone’s stock has been suspended on the Toronto Stock Exchange (TSE). (See BakBone Slapped in Toronto.)

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