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Technology Stocks : Cisco Systems, Inc. (CSCO)
CSCO 70.89-0.3%11:37 AM EST
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To: RetiredNow who wrote (64444)9/10/2003 11:33:01 AM
From: Mick Mørmøny  Read Replies (1) of 77397
 
More CSCO news --

<font color=orange> Cisco also disclosed in the filing that accounting for stock options would have reduced its fiscal 2003 net profit by more than a third. </font> The company does not include options in its results and has resisted the push by regulators and some investors to have that mandated.

Taking into account its stock options, Cisco said it earned $2.32 billion, or 32 cents a diluted share, in the 2003 fiscal year ended in July. Excluding the impact of the options, the company reported a net profit of $3.58 billion, or 50 cents a diluted share.

During the boom market of the late 1990s, stock options were the favorite compensation for technology companies to attract or retain workers without actually paying them more.

Critics say stock options, or the right to buy or sell stock at a set price at a future date, can inflate earnings because companies do not book them as an expense. Currently, companies must disclose their cost only in a footnote to their financial statements.

Cisco also reiterated it will take a noncash charge in its current quarter of about $400 million due to recently adopted accounting rules. The charge relates to consolidating its stake in Andiamo, a maker of storage networking equipment that it expects to acquire this quarter.

biz.yahoo.com
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