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U.S. Securities and Exchange Commission

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 45243 / January 7, 2002

Accounting and Auditing Enforcement
Release No. 1487 / January 7, 2002

Administrative Proceeding
File No. 3-10673


In the Matter of

CAROL CONWAY DEWEES,

Respondent.


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ORDER INSTITUTING CEASE-AND-DESIST PROCEEDINGS PURSUANT TO SECTION 21C OF THE SECURITIES EXCHANGE ACT OF 1934, MAKING FINDINGS AND IMPOSING CEASE-AND-DESIST ORDER

I.

The Commission deems it appropriate that cease-and-desist proceedings be instituted pursuant to Section 21C of the Securities Exchange Act of 1934 ("Exchange Act"), with respect to Carol Conway DeWees ("DeWees").

II.

In anticipation of these proceedings, DeWees has submitted an Offer of Settlement ("Offer") which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission or to which the Commission is a party, and without admitting or denying the findings contained herein, except that DeWees admits the jurisdiction of the Commission over her and the subject matter of this proceeding and the matters described in paragraphs III.A. through III.C. of this Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings and Imposing Cease-and-Desist Order ("Order"), DeWees has consented to the findings1 and sanctions set forth below.

Accordingly, IT IS ORDERED that proceedings pursuant to Section 21C of the Exchange Act be, and they hereby are, instituted.

III.

On the basis of this Order and the Offer submitted by DeWees, the Commission finds that:

A. Respondent DeWees, age 58, is a resident of Laguna Niguel, California, is currently the president of California Software Corporation ("California Software"), and during the period relevant to this matter held the title of chief financial officer of California Software;

B. In August 1999 California Software began filing periodic reports with the Commission and in September 1999 California Software became a reporting company to the Commission pursuant to Section 12(g) of the Securities Exchange Act of 1934;

C. From September 1999 through May 2000, California Software filed a Form 10-SB, two Forms 10-Q, a Form 10-QSB and a Form 10-KSB with the Commission, which filings contained audited and unaudited financial statements of California Software and California Software Products, Inc., a predecessor corporation to California Software;

D. Respondent DeWees signed the Forms 10-SB, 10-Q, 10-QSB and 10-KSB filed with the Commission as California Software's chief financial officer, but did not review the filings prior to their being filed with the Commission;

E. Those filings contained materially false information in that the financial statements included in those filings materially overstated the revenue, earnings, assets and shareholders equity of California Software and California Software Products, Inc., primarily as a result of a revenue recognition practice in which the companies recognized revenue upon shipment of their software to potential customers prior to receiving persuasive evidence of an arrangement from the potential customers to purchase the software; and

F. By the conduct described in paragraphs III.A. through III.E. above, DeWees has caused California Software's violation of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1 and 13a-13 thereunder.

IV.

In view of the foregoing, it is appropriate to impose the sanctions agreed to in the Offer submitted by DeWees. Accordingly,

IT IS ORDERED, pursuant to Section 21C of the Exchange Act that the Respondent, Carol Conway DeWees, cease and desist from causing any violation and any future violation of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1 and 13a-13 promulgated thereunder;

By the Commission.

Jonathan G. Katz
Secretary

Footnote

1 The findings herein are made pursuant to Respondent's Offer of Settlement and are not binding on any other person or entity in this or any other proceeding.

http://www.sec.gov/litigation/admin/34-45243.htm


Modified: 01/08/2001