Novell checks books for backdating; posts only preliminary Q3 results.(Linux Watch)

Novell was only able to post preliminary fiscal third-quarter results Tuesday because it's hired outside legal counsel to review its past stock option practices for indications of backdating, so the results it put out, it said, don't reflect any adjustments that may have to be made.

The numbers won't firm up until Novell files its 10-Q, which depends on how long the audit takes, and Novell doesn't know when that will be. It warned that it may not be "timely," creating a whole welter of other problems like the threats of delisting that are becoming increasingly familiar to investors.

It said it didn't know whether the review would force it to record charges, pay additional taxes, restate past financial statements or find its internal controls faulty.

So, on a preliminary basis then Novell earned $11.5 million, or three cents a share, up significantly from last year's breakeven $2.1 million, but exactly what the market expected.

Notice, however, that a lot of the surge was due to discontinued operations and that it lost a penny a share on continuing operations.

Revenues were $241 million, down 4.4%, a bit more depressed than the stock market figured they would be.

Revenues were down in part because Novell sold off its Celerant consulting subsidiary during the quarter.