An accounting investigation at Dell has become serious, prompting the computer manufacturer to delay its financial results, suspend a share buyback programme and cancel a conference with analysts.

In addition to a previously disclosed investigation by the Wall Street regulator, the Securities and Exchange Commission (SEC),

Dell revealed that a US attorney in New York has subpoenaed scores of documents dating back to 2002 - a sign that a criminal case is under consideration.

Dell told US technology analysts who were due to travel to New York for a meeting tomorrow to stay at home.

Don Carty, chairman of Dell's boardroom audit committee, said: "We have not yet reached any conclusion on materiality as to these issues. We are continuing to investigate the matter fully." His statement was a change in tone from Dell's original disclosure of an SEC investigation last month, when the company said it was "not material".

Regulators are looking into whether Dell has mis-stated its accounts.

It has declined to reveal details of the alleged discrepancies, except to say they relate to "accruals, reserves and other balance sheet items".

The issue adds to a list of headaches for the Texas-based company, which is recalling 4.1 million laptop batteries at risk of overheating and catching fire.

The company's stock has sunk by more than one-third over the past year amid slowing demand for PCs and competition from rivals such as Hewlett-Packard (HP), which has been gaining share in the laptop market.

Roger Kay, an analyst at Endpoint Technologies, said Dell's management was "under siege"and added that although the accounting problems may yet be relatively small, uncertainty was a major problem

"Perception rules. If people feel there's something wrong, that there's a fundamental financial liability there, that scares a lot of people."

Founded by chairman Michael Dell from his University of Texas dormitory, Dell had prospered thanks to its low operating costs and direct sales to consumers. But customers have grown impatient with Dell's poor customer service and its profits fell 51 per cent to $502 million in the second quarter.

Mr Dell said: "We are fully cooperating with the investigations and working to resolve any and all issues raised in connection with those investigations as quickly as possible, and we will take any appropriate remedial or corrective actions to address any problems."

Yesterday, Dell shares fell in morning trading in New York to their lowest level since 2001. The company's dip in fortunes has prompted speculation that Mr Dell could wrest control from chief executive Kevin Rollins.

Several research firms downgraded their ratings of the company yesterday. One, American Technology Research, removed Dell shares from its "recommended" list.

Meanwhile, HP said it had been contacted by the US attorney in northern California regarding an investigation into boardroom leaks.

Revelations that private investigators impersonated board members and journalists to obtain private telephone records have prompted calls for the resignation of Patricia Dunn, HP's chairwoman.

- (Guardian, Financial Times service)