Apple today announced that the special committee of its board of directors has reported its findings after a three month investigation into Apple’s stock option practices. The special committee of outside directors, together with independent counsel and accountants, examined more than 650,000 emails and documents, and conducted interviews with more than 40 current and former employees, directors and advisors. Apple initiated this voluntary independent investigation after a management review discovered irregularities in past stock option grants.
The independent investigation’s key findings are:
• The investigation found no misconduct by any member of Apple’s current management team.
• The most recent evidence of irregularities relates to a January 2002 grant.
• Stock option grants made on 15 dates between 1997 and 2002 appear to have grant dates that precede the approval of those grants.
• In a few instances, Apple CEO Steve Jobs was aware that favorable grant dates had been selected, but he did not receive or otherwise benefit from these grants and was unaware of the accounting implications.
• The investigation raised serious concerns regarding the actions of two former officers in connection with the accounting, recording and reporting of stock option grants. The company will provide all details regarding their actions to the SEC.
“I apologize to Apple’s shareholders and employees for these problems, which happened on my watch. They are completely out of character for Apple,” said Steve Jobs, Apple’s CEO, in the press release. “We will now work to resolve the remaining issues as quickly as possible and to put the proper remedial measures in place to ensure that this never happens again.”
The company also announced that Fred Anderson, Apple’s former CFO, has resigned from its board of directors. Mr. Anderson, who served as CFO from 1996 until 2004, informed the company that he believes it is in Apple’s best interests that he resign from the board at this time.
The company and its independent auditors are reviewing the findings of the independent investigation. Management continues to believe, and the audit committee agrees, that Apple will likely need to restate its historical financial statements to record non-cash charges for compensation expense relating to past stock option grants. The company and its independent auditors are reviewing recent accounting guidance published by the SEC, and have not yet determined the amount of such charges, the resulting tax and accounting impact, or which periods may require restatement. The company continues to proactively inform the SEC of its findings.
Apple stock dipped 57 cents after hours to $74.81.
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Apple’s options imbroglio: Mac-maker granted options at or near key events in company’s history – August 18, 2006
Apple added to Nasdaq’s list of ‘delinquent companies’ – August 18, 2006
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Apple to investigate stock option grant ‘irregularities’ made between 1997 and 2001 – June 29, 2006
<<Macaday>>
<<As this has been regarded as a “threat” hanging over Apple, now it is lifted it gives it yet more shine…>>
EXACTLY!!
The threat has DISAPPEARED into much ado over nothing…
Back to business almost as usual… Great products. Greater still.
And greater carefulness about the stock options! LOL
As this has been regarded as a “threat” hanging over Apple, now it is lifted it gives it yet more shine…”
No THREAT has been lifted. This is an Apple INTERNAL report and as such is pretty DAMNING. It basically admits Steve Jobs KNEW about the irregularities but was just too DUMB to understand the implications.
The SEC may not put such a warm fuzzy spin on Steve’s involvement.
So now Steve’s now admitted he KNEW that this was going on. and He’s now claiming he didn’t UNDERSTAND what was going on, that leaves one small thing for the SEC to show, that he did UNDERSTAND.
I for one don’t beleive for a second that the guy’s too dumb to understand the effect of backdating stock options on the value of those options.
Yeah….but hasn´t everything been released been Apple generated? This is not a Fed report; wait until the Fed guys step into this and issue their report/supeonas/perp walks.
I don´t think they will take a “I´m sorry” from Steve reply.
Questionable/Illegal activity was done at a company, the CEO knew/approved it and saw the Feds coming in soon, so turned themselves in, now they issue an “I´m sorry”, oops we did something illegal.
Nah…this story ain´t over. Fines and jail time for some people. Steve is going to be devoting lots of time with lawyers and not worrying about the next great Apple product. (And could this be why things are taking so long to come out? Steve is preoccupied?)
And the other thing….Al Gore.
Appel Board Member Al Gore is thinking of running for President again.
Just the stink of this Apple investigation is causing Al heartburn.
And now the CEO has even admitted he is guilty.
Poor Al.
One can read the headlines on Drudge Report:
“Al Gore in Apple Stock Options Scandal!”
Bye, Bye Al and the 2008 Presidential run.
Al is working on his excuses right now (too late to resign), “Sure I was an Apple Board Member, but I did not do or know anything…”
And he will be carrying a Zune to the Press Conference…
“Fines and jail time for some people”
LMAO!!!
Uh… Does Judge Judy know her sister has been smokin’ crack?
You don’t know the history of favorable grant dates. I do.
Judge: “Guilty of stock option manipulation”.
CEO: “Judge, if I just say “I´m sorry to all the stockholders” will that make everything better?”
———–
If what the CEO of Apple did was not wrong, why the investigation, why is the Govt. having a pseudo-criminal investigation?
Check into all the others that have done this – fines, jail time, heart attacks, resignations. There was not one “I´m sorry” and they walked away unscathed.
I have been staying away from Spicy stuff, potatoes, and the like, but I still get a bit of heartburn every now and then. I am going to talk to my doctor about it, but in the meantime are there any remedies one might recommend? Thanks your answers are much appreciated.
Heartburn