Computer maker Dell said its audit committee has finished its investigation into the company's accounting and financial reporting issues and has identified significant errors and irregularities.

The finding has prompted Dell to restate its financial results for fiscal 2003, 2004, 2005, 2006 and the first quarter of fiscal 2007, reducing net income by a cumulative total of between $50 million and $150 million. Earnings per share would also be reduced by $0.02 to $0.07.

Dell began the investigation in August 2006 but has been relatively tight-lipped about the details up to now. According to the company, most of the accounting issues involved adjustments to various reserve and accrued liability accounts. The audit committee found evidence that some of the adjustments had been motivated by the objective of attaining financial targets. The investigation found that account balances were reviewed, sometimes at the request of senior executives, and adjustments made to meet quarterly performance objectives.

Dell CEO Kevin Rollins and CFO James Schneider stepped down in January, with company founder Michael Dell taking back the CEO role and former American Airlines chief Donald Carty taking over the CFO position. Carty said in a conference call that the investigation had found "evidence of fraud."

Among the improper adjustments discovered by the investigators were the creation and release of accruals and reserves, the transfer of express accruals from one liability account to another, and the use of excess balances to offset unrelated expenses in later periods. Some business unit personnel did not provide complete information to Dell corporate headquarters or offered purposely incorrect or misleading information.

Dell said it is reorganizing its finance function, separating the accounting and financial reporting responsibility from planning and forecasting. The company is also strengthening the chief accounting officer position and making it responsible for all accounting and financial reporting functions worldwide. In addition, Dell said it is working on improving its internal controls around journal entry processes, including account reconciliation and documentation requirements.

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