A spokeswoman for the company said the discrepancies at Baltimore Technologies Japan were due to signed contracts that had been booked as revenues but never came through.

The news coincided with an announcement that UK technology group Guardian IT (quote from Yahoo! UK & Ireland: GRD.L) had uncovered accounting errors of up to 2.5 million pounds ($3.6 million). The spotlight has turned on corporate accounting practices worldwide following the collapse of U.S. energy trader Enron Corp in December.

Baltimore said revenues, operating profits and shareholders funds for the period would be cut by less than two percent after adjusting for the overstatement.

Revenue in 2000 will fall by 724,000 pounds ($1.03 million) to 69.4 million pounds. In the six months to June 30, 2001, revenue will drop by 735,000 pounds to 38.7 million pounds.

Baltimore said it had found the overstatements when it cut its holding in BTJ to 19 percent from 62.5 percent at the beginning of February.

Baltimore's products are used by such big names as American Express, Mastercard and Visa for processing credit card transactions over the Internet, but its revenues have been less than hoped and the company has yet to be profitable.

The firm sold its Content Technologies unit at the end of January for 20.5 million pounds ($29.1 million) to assure working capital for 12 months.

Yahoo!

-- Anonymous, February 12, 2002