Covad shares resumed trading on Nasdaq Tues. and promptly plunged...

to review new SEC-required accounting changes that could materially reduce revenue for last year. Earnings before interest, taxes, depreciation and amortization losses also may increase $17 million, Covad said. DSL provider said “further analysis is required to confirm these estimates.” Covad also said it had: (1) Recorded goodwill and other intangible assets of $120 million linked to acquisition of BlueStar Communications. “The company is currently evaluating whether any portion of goodwill or intangible assets are impaired,” Covad said. It hasn’t yet assessed magnitude of any write-down. (2) Listed $50-$200 million in restructured charges and tangible asset impairment charges for 2000 and 2001 in previously announced cost-cutting efforts. Timing and magnitude of charges still was being gauged. (3) Marketing development funds provided to help customers with marketing efforts and recorded as 2000 expenses are estimated to be $38 million. Covad was reviewing quarter-to-quarter timing of classification of those payments as expenses or revenue offsets “and any additional commitments made but yet to be recorded.” Covad said it had begun to review of internal procedures used to implement service contracts and bill customers. In last few months, several CLECs and IXCs have noted in financial disclosures that their revenue reports were being affected by cash-strapped ISPs that couldn’t pay their bills. To ensure correct recognition of revenue, Covad is reviewing ISP contracts, billings, marketing development funds. Efforts to prepare financial statements in line with SEC-required accounting rule change are expected to take several weeks. Until then, company said it couldn’t provide guidance on expected impact of statements. Nasdaq had halted trading of Covad shares Fri., saying they wouldn’t resume until “additional information” was received from the company. Covad shares closed down 43.4% on Nasdaq to $1.62.