| COVANSYS COMPLETES ANALYSIS OF
ACCOUNTING FOR CERTAIN PROPERTY AND EQUIPMENT
Confirms Non-Cash Charge of Approximately $2.6 Million for Assets
Including Missing, Obsolete, and Disposed of Equipment
FARMINGTON HILLS, Mich., July 1 /PRNewswire-FirstCall/ -- Covansys
Corporation (Nasdaq: CVNSE - News), a worldwide provider of information
technology services, today announced that it has completed its
analysis of accounting issues related to a recently completed
physical inventory and assessment of certain assets. Consistent
with prior reports, the Company confirmed that it anticipated
taking a non-cash charge relating to items including missing,
obsolete or disposed of equipment and furniture with a net book
value of approximately $2.6 million, or less than 1% of Covansys'
total assets. Covansys has concluded that a portion of the non-cash
charge should be allocated to prior periods and has requested
guidance from the Securities and Exchange Commission regarding
the appropriate periods in which the charge should be recorded.
The Company intends to file its Form 10-Q for the quarter ended
March 31, 2004 promptly after this issue has been resolved.
The Company also had an oral hearing today before a Nasdaq Listing
Qualification Panel. Covansys expects its common stock to resume
trading under the ticker symbol "CVNS" once the filing
of its Form 10-Q is completed.
About Covansys
Covansys Corporation, (Nasdaq: CVNSE - News), is a global consulting
and technology services company specializing in industry-specific
solutions, strategic outsourcing and integration services through
a unique onsite, off-site, offshore delivery model that helps clients
achieve rapid deployment, world-class quality and reduced costs.
Founded in 1985, Covansys has successfully delivered an array of
innovative and cost-effective business and technical solutions
to leaders in the private and public sectors. With one of the largest
offshore capabilities of any technology services provider based
in the United States, Covansys has achieved the SEI's CMM® Level
5 quality ratings at two of its offshore development centers in
India.
Safe Harbor Statement
With the exception of statements regarding historical matters
and statements concerning our current status, certain matters discussed
herein are forward-looking statements that involve substantial
risks and uncertainties. Such forward-looking statements may be
identified by the words "anticipate," "believe," "estimate," "expect" or "intend" and
similar expressions. Our actual results, performance or achievements
could differ materially from these forward-looking statements.
Factors that could cause or contribute to such material differences
include actions by governmental or regulatory agencies, general
economic conditions and conditions in the IT industry such as the
demand for IT services, public sector government budgetary constraints,
potential cost overruns on fixed-price projects, effective application
of the percentage of completion method of accounting for fixed
priced contracts, risks related to merger, acquisition and strategic
investment strategy, variability of operating results, government
regulation of immigration, exposure to regulatory, political and
economic conditions in India and Asia, competition in the IT services
industry, the short-term nature and termination provisions of contracts,
economic conditions unique to clients in specific industries and
limited protection of intellectual property rights. These and other
factors are described in the Company's filings with the U.S. Securities
and Exchange Commission.
FOR FURTHER INFORMATION:
Covansys Corporation
Investors:
David Roady, 248-848-2221
droady@covansys.com
or
Media:
Laura Livingstone, 401-457-8514
llivings@covansys.com
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