The nation's No.3 office supply store chain has announced the resignation of its chief financial officer and termination of six other employees after an internal investigation yielded accounting irregularities, the Associated Press reported.

OfficeMax Inc. announced the resignation of CEO Christopher C. Milliken and said George J. Harad, the company's executive chairman, would replace him on an interim basis.

The Itasca, IL, company said it would begin a search for a permanent CEO, a task that could be hampered by a simultaneous chief executive search by No. 2 office retailer OfficeDepot.

Last month, OfficeMax's Chief Financial Officer Brian Anderson resigned, and the company said its fourth-quarter earnings report would be delayed because of accounting problems.

As a result of the internal investigation into its accounting, OfficeMax said it had overstated fiscal year 2004 first-quarter operating income by $5 million to $10 million by not reporting some rebates and payments to vendors, the AP reported.

Milliken's resignation was a "mutual decision" between the CEO and the board of directors related to the company's operations and financial situation, spokesman Bill Bonner said and the Associated Press reported. He declined to elaborate. "We are taking steps to strengthen the OfficeMax management team, and fully expect to demonstrate the value inherent in this business for our shareholders," Harad said in a statement Monday.

The six employees were fired when it was discovered that some had fabricated supporting documentation for nearly $3.3 million in claims billed to a supplier of its retail business, the AP reported.

The company plans to report fourth-quarter and full-year results on March 14, anticipating 2004 operating income to be $125 million to $135 million.

Analyst Anthony Chukumba of Chicago-based Morningstar told the AP that Milliken's departure was probably inevitable in light of the company's recent problems. "At the end of the day, when you have a scandal like this, the CEO has got to go," he said.