Apple Wraps Backdating Probe
By Colleen Taylor -- EDN, December 29, 2006
Consumer electronics hotshot Apple Computer Inc. is standing by its man, CEO Steve Jobs, following the conclusion of its internal stock options probe.
Today the company filed its Form 10-Q for the quarter ended July 1 and its Form 10-K for the fiscal year ended September 30 with the Securities and Exchange Commission (SEC). Both filings had been delayed pending the conclusion of an independent investigation into whether or not the company had engaged in the now-notorious practice of stock options backdating and the resulting restatement of the company's financial results.
The delay had caused a threat of delisting of Apple's shares from the Nasdaq stock market, however, Nasdaq gave Apple a pass in October for continued inclusion in the market.
Based on the findings of the independent investigation, Apple said it has recognized total additional non-cash stock-based compensation expense of $84 million after tax, including $4 million and $7 million in fiscal years 2006 and 2005, respectively. The restatement arises solely from certain stock option grants made between 1997 and 2002; the investigation found no grants after December 31, 2002 that required accounting adjustments, Apple said.
In a statement today, Apple said its board has "complete confidence" in CEO Steve Jobs and the senior management team, and that it is "confident that the company has corrected the problems that led to the restatement." Since admitting backdating in October, Apple has maintained that although in some instances Jobs was aware that favorable grant dates had been selected, he did not receive or otherwise benefit from these grants and was unaware of the accounting implications.
