KIS -
Well, sure. I get that. Nobody was expensing options against earnings until recently, and even backdated options were considered not to be expensable.
Here's what's going to happen here. Apple and other companies will restate earnings and expenses for whatever period of time, and they will possibly pay some additional taxes. They may pay some fines. It won't go farther than that because there was no intention to commit fraud.
In the case of companies where the backdating was accompanied by things like granting options to fictitious employees, where there is clearly an intention to commit fraud, there will be criminal prosecution.
It's important to look past the headlines and consider the entire situation with each individual company's case. So far there has been no hint that real fraud was committed at Apple, and thus there's no reason to be predicting such dire outcomes.
This post contains forward-looking statements. Due to my inability to predict the future, and the fact that I don't know everything, there is always the chance that real results may vary.
- Allen
PS: There is some question as to whether options, which are not vested until a future date, are the equivalent of stock grants. They might be "in the money" when granted, but there's never a guarantee that they will be when they vest. |
