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Apple restates past earnings, stands by exec team

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By LC Angell

Contributing Editor
Published: Friday, December 29, 2006
News Categories: Apple

Following an independent investigation into the backdating of past stock option practices, Apple today restated past earnings, but cleared current executives of misconduct. Apple said it will record a non-cash charge of $84 million to compensate for improperly handled stock option grants made between 1997 and 2002. The company said after-tax profits would be lowered by $10 million for 2004, $7 million for 2005 and $4 million for 2006.

In delayed filings with the Securities and Exchange Commission, the company said a special committee of its board found that while Apple CEO Steve Jobs and other managers recommended or were aware of certain inaccurate grant dates, they did not financially benefit from them. Apple said it has “complete confidence” in the executive team.

“The special committee, its independent counsel and forensic accountants have performed an exhaustive investigation of Apple’s stock option granting practices,” said Al Gore, chair of the special committee, and Jerome York, chair of Apple’s Audit and Finance Committee, in a joint statement. “The board of directors is confident that the company has corrected the problems that led to the restatement, and it has complete confidence in Steve Jobs and the senior management team.”

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Comments

1

...and it has complete confidence in Steve Jobs and the senior management team

Considering the recent financial performance of the company, did anyone really expect them to say anything less?

Posted by flatline response on December 29, 2006 at 1:57 PM (PDT)

2

flatline - exactly.  It’s not like they were going to come out and say “Oh, and by the way, our management team is a bunch of crooked thieves just like every other evil corporation in the known world.  Happy Holidays!”

This is a big “soothe the investors” statement that ultimately means nothing.

Posted by stark23x on December 29, 2006 at 2:11 PM (PDT)

3

They are obviously trying to manipulate the stock price by hiding this release in the year end news cycle.

Posted by RB on January 1, 2007 at 4:59 PM (PDT)

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