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To: Johnny Canuck who wrote (40820)	3/11/2004 5:51:48 AM
From: Johnny Canuck	Read Replies (2) \| Respond to of 69345

Nortel to Again Revise Results for 2003, Prior Periods Wednesday March 10, 11:31 pm ET Dow Jones Business News TORONTO -- Nortel Networks Corp. (NYSE:NT - News) said late Wednesday that an ongoing independent review by the company's audit committee has uncovered a need for further revisions to results for 2003 and possibly years prior. ADVERTISEMENT Since November, Nortel's audit committee has been looking into the circumstances surrounding the Brampton, Ontario, telecommunications-gear maker's restatement, which stemmed from the discovery of about $900 million in liabilities that were either recorded incorrectly in prior periods or not properly released in the appropriate periods. The restated results for 2000, 2001, 2002, as well as the first two quarters of 2003, were filed with the Securities and Exchange Commission (News - Websites) in late December. According to the December filing, the restatement had the effect of narrowing losses for the years 2000 through 2002, and resulted in a profit for the second quarter of 2003 rather than a loss. However, the first-quarter 2003 profit was revised downward to $11 million from $54 million. But the company now says it will likely revise results already announced for 2003 as well as for one or more earlier periods. In January, the company announced a solid fourth-quarter profit after a year-earlier loss, and far surpassed analysts' expectations. Because of the audit committee's work done to date, Nortel is "re-examining the establishment, timing of, support for and release to income of certain accruals and provisions in prior periods." "Nortel Networks cannot predict at this time when such review will be completed given the volume and complexity of the work involved," according to the press release. A Nortel spokeswoman couldn't say to what extent the audit committee had been involved with or overseen the company's restatement filed in December. Also in the December filing, Nortel said that the company's auditors, Deloitte & Touche LLP, had identified material weaknesses in the company's accounting procedures and internal controls. Until the latest revisions are ready, Nortel won't be able to file with the SEC its annual report for 2003. Once the delay extends beyond March 30, the company won't be in compliance under certain indenture covering about $1.8 billion in convertible debt securities and another $1.8 billion on the notes of its principal operating unit, Nortel Networks Limited. But, even if debt holders give a notice of default, the company will then have 90 days to file its 10-K before the holders can accelerate the debt. The filing delay beyond March 30 would also give Export Development Canada the right to terminate a credit facility providing $300 million of committed support and US$450 million of uncommitted support. Nortel plans to seek a temporary waiver so it can continue to use the facility while it completes the filing obligations. At the end of 2003 there was about $334 million of outstanding support. -Pamela Tate; Dow Jones Newswires; 201-938-5400