Revenue recognition setback for Misys
Computer software group Misys warns investors of profit shortfalls because of revenue recognition difficulties
Misys, the FTSE250 computer software group, said delays in revenue
recognition were expected to reduce earnings per share for the first half of the
Kevin Lomax, Misys executive chairman, added that the shortfall was unlikely
to be ‘fully recovered’ over the second six months of the financial year.
Lomax said that as contracts became larger and more complex, timing of
contract signing was harder to predict and, as a result, revenue recognition
occurred over a longer period.
‘In line with this trend, revenue recognition on a number of larger banking
projects will now occur later than anticipated,’ said Lomax.
Misys’ stock fell 16% in morning trade on the back of the news.