Publicly traded Computer Sciences Corp., El Segundo, Calif., one of four lead contractors that each developed a prototype of the National Health Information Network under contract with HHS, announced Thursday it has "discovered significant errors in its accounting for tax liabilities in fiscal years 2000 through 2006," and as a result has delayed filing its annual financial reports with the Securities and Exchange Commission.
In a news release, the company said: "The correction of these errors, and other insignificant errors, will result in a cumulative charge of $300 million to $400 million through March 31, 2006." CSC also said its annual report for the fiscal year ended on that date along with the accompanying report of CSC's independent registered accounting firm "should no longer be relied upon because of errors" in the financial statements.
CSC said it will "restate prior periods" when it files its annual SEC report, or Form 10-K, for the fiscal year ended March 31, 2007. The company said it expects that report to be filed by June 13.
In late 2005, HHS awarded $18.6 million in contracts to four consortia to develop prototypes of a future NHIN. CSC, Accenture, IBM Corp. and Northrop Grumman Corp. were the lead contractors for the consortia. They delivered their proposals in January to the American Health Information Community, an information technology advisory panel to HHS Secretary Mike Leavitt. CSC also is a major player in the National Health Service clinical IT program in the United Kingdom. -- by Joseph Conn / HITS staff writer