Backdating of executive stock options

Then, after the announcement boosts the share price to , each option would be worth . "Then you have both insider trading and you have an accounting issue," Ryan said.

"An old-fashioned cooking-the-books fraud." Q: Would fixing executives' grant date to, say, July 1 every year fix things? tax code limits companies' ability to deduct pay for certain executives if the amount exceeds

Then, after the announcement boosts the share price to $25, each option would be worth $5. "Then you have both insider trading and you have an accounting issue," Ryan said."An old-fashioned cooking-the-books fraud." Q: Would fixing executives' grant date to, say, July 1 every year fix things? tax code limits companies' ability to deduct pay for certain executives if the amount exceeds $1 million a year.Q: Under what circumstances is backdating legal or illegal? If a company's executives are up-front about it with shareholders and the government, everything's probably fine. Attorney's office in New York have been conducting parallel investigations. Paul Caron, a visiting professor at the University of San Diego School of Law and author of the Tax Prof blog, outlined two possible tax law violations in an e-mail to CNET Typically the contact comes in the form of a grand jury subpoena.The problem, though, is that the allegations that have come to light have not included full disclosure to shareholders, payment of extra applicable taxes, and earnings statements that reflect the modified grant dates. Some Bay Area companies have announced that they've been contacted by the U. They include: Altera Applied Micro Circuits Asyst Technologies CNET Networks Equinix Foundry Networks Intuit Linear Technology Marvell Technology Group Maxim Integrated Products Openwave Systems Power Integrations Redback Networks Veri Sign Zoran Source: Wall Street Journal database One consideration, Caron said: Did the companies take the backdating into account when calculating how much they owed under the tax code, which limits a public company's deduction of employee compensation to $1 million?The tech industry's stock option backdating scandal appears to be gathering steam.Last week, federal investigators announced criminal charges against former executives of Brocade Communications Systems, and they're hinting that more cases may be on the way.

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Then, after the announcement boosts the share price to $25, each option would be worth $5. "Then you have both insider trading and you have an accounting issue," Ryan said.

"An old-fashioned cooking-the-books fraud." Q: Would fixing executives' grant date to, say, July 1 every year fix things? tax code limits companies' ability to deduct pay for certain executives if the amount exceeds $1 million a year.

Q: Under what circumstances is backdating legal or illegal? If a company's executives are up-front about it with shareholders and the government, everything's probably fine. Attorney's office in New York have been conducting parallel investigations. Paul Caron, a visiting professor at the University of San Diego School of Law and author of the Tax Prof blog, outlined two possible tax law violations in an e-mail to CNET Typically the contact comes in the form of a grand jury subpoena.

The problem, though, is that the allegations that have come to light have not included full disclosure to shareholders, payment of extra applicable taxes, and earnings statements that reflect the modified grant dates. Some Bay Area companies have announced that they've been contacted by the U. They include: Altera Applied Micro Circuits Asyst Technologies CNET Networks Equinix Foundry Networks Intuit Linear Technology Marvell Technology Group Maxim Integrated Products Openwave Systems Power Integrations Redback Networks Veri Sign Zoran Source: Wall Street Journal database One consideration, Caron said: Did the companies take the backdating into account when calculating how much they owed under the tax code, which limits a public company's deduction of employee compensation to $1 million?

The tech industry's stock option backdating scandal appears to be gathering steam.

million a year.

Q: Under what circumstances is backdating legal or illegal? If a company's executives are up-front about it with shareholders and the government, everything's probably fine. Attorney's office in New York have been conducting parallel investigations. Paul Caron, a visiting professor at the University of San Diego School of Law and author of the Tax Prof blog, outlined two possible tax law violations in an e-mail to CNET Typically the contact comes in the form of a grand jury subpoena.

The problem, though, is that the allegations that have come to light have not included full disclosure to shareholders, payment of extra applicable taxes, and earnings statements that reflect the modified grant dates. Some Bay Area companies have announced that they've been contacted by the U. They include: Altera Applied Micro Circuits Asyst Technologies CNET Networks Equinix Foundry Networks Intuit Linear Technology Marvell Technology Group Maxim Integrated Products Openwave Systems Power Integrations Redback Networks Veri Sign Zoran Source: Wall Street Journal database One consideration, Caron said: Did the companies take the backdating into account when calculating how much they owed under the tax code, which limits a public company's deduction of employee compensation to

Then, after the announcement boosts the share price to $25, each option would be worth $5. "Then you have both insider trading and you have an accounting issue," Ryan said."An old-fashioned cooking-the-books fraud." Q: Would fixing executives' grant date to, say, July 1 every year fix things? tax code limits companies' ability to deduct pay for certain executives if the amount exceeds $1 million a year.Q: Under what circumstances is backdating legal or illegal? If a company's executives are up-front about it with shareholders and the government, everything's probably fine. Attorney's office in New York have been conducting parallel investigations. Paul Caron, a visiting professor at the University of San Diego School of Law and author of the Tax Prof blog, outlined two possible tax law violations in an e-mail to CNET Typically the contact comes in the form of a grand jury subpoena.The problem, though, is that the allegations that have come to light have not included full disclosure to shareholders, payment of extra applicable taxes, and earnings statements that reflect the modified grant dates. Some Bay Area companies have announced that they've been contacted by the U. They include: Altera Applied Micro Circuits Asyst Technologies CNET Networks Equinix Foundry Networks Intuit Linear Technology Marvell Technology Group Maxim Integrated Products Openwave Systems Power Integrations Redback Networks Veri Sign Zoran Source: Wall Street Journal database One consideration, Caron said: Did the companies take the backdating into account when calculating how much they owed under the tax code, which limits a public company's deduction of employee compensation to $1 million?The tech industry's stock option backdating scandal appears to be gathering steam.Last week, federal investigators announced criminal charges against former executives of Brocade Communications Systems, and they're hinting that more cases may be on the way.

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Then, after the announcement boosts the share price to $25, each option would be worth $5. "Then you have both insider trading and you have an accounting issue," Ryan said.

"An old-fashioned cooking-the-books fraud." Q: Would fixing executives' grant date to, say, July 1 every year fix things? tax code limits companies' ability to deduct pay for certain executives if the amount exceeds $1 million a year.

Q: Under what circumstances is backdating legal or illegal? If a company's executives are up-front about it with shareholders and the government, everything's probably fine. Attorney's office in New York have been conducting parallel investigations. Paul Caron, a visiting professor at the University of San Diego School of Law and author of the Tax Prof blog, outlined two possible tax law violations in an e-mail to CNET Typically the contact comes in the form of a grand jury subpoena.

The problem, though, is that the allegations that have come to light have not included full disclosure to shareholders, payment of extra applicable taxes, and earnings statements that reflect the modified grant dates. Some Bay Area companies have announced that they've been contacted by the U. They include: Altera Applied Micro Circuits Asyst Technologies CNET Networks Equinix Foundry Networks Intuit Linear Technology Marvell Technology Group Maxim Integrated Products Openwave Systems Power Integrations Redback Networks Veri Sign Zoran Source: Wall Street Journal database One consideration, Caron said: Did the companies take the backdating into account when calculating how much they owed under the tax code, which limits a public company's deduction of employee compensation to $1 million?

The tech industry's stock option backdating scandal appears to be gathering steam.

million?

The tech industry's stock option backdating scandal appears to be gathering steam.

Academics have found some evidence that CEOs time the release of negative information to happen just before a scheduled grant date, and release positive information after a scheduled grant date. So companies can save on taxes by handing out lucrative stock options instead of lucrative salaries.That makes backdating more difficult and is generally thought to have curbed the practice. They found that about 24 percent of stock option grants are reported late. "Backdating and camouflaged timing appear to be practiced even after SOX, especially by smaller firms." In a follow-up paper (click for PDF), Narayanan and Seyhun add: "We find that executives can increase their compensation even in the post-SOX era by playing the dating game and reporting their options late. Why else would Apple CEO , and Google CEO Eric Schmidt only ask for

Academics have found some evidence that CEOs time the release of negative information to happen just before a scheduled grant date, and release positive information after a scheduled grant date. So companies can save on taxes by handing out lucrative stock options instead of lucrative salaries.

That makes backdating more difficult and is generally thought to have curbed the practice. They found that about 24 percent of stock option grants are reported late. "Backdating and camouflaged timing appear to be practiced even after SOX, especially by smaller firms." In a follow-up paper (click for PDF), Narayanan and Seyhun add: "We find that executives can increase their compensation even in the post-SOX era by playing the dating game and reporting their options late. Why else would Apple CEO , and Google CEO Eric Schmidt only ask for $1 in salary?

But Sarbanes-Oxley probably has not eliminated backdating. Our findings indicate that a manager receiving a large grant of 1,000,000 shares of a typical company's stock can increase the value of their grant by about $1.23 million, or 8 percent, by reporting 30 days late." Q: Why is there this emphasis on stock options? (In fact, if Congress had simplified the tax code and made CEO salaries fully deductible, it's likely that no backdating scandal would have occurred.

Of course, honest CEOs would help too.) Q: What lawsuits have been filed by investors over stock option backdating?

Apple faces a number of suits filed on behalf of shareholders and pension plans in federal and state courts in California.

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Academics have found some evidence that CEOs time the release of negative information to happen just before a scheduled grant date, and release positive information after a scheduled grant date. So companies can save on taxes by handing out lucrative stock options instead of lucrative salaries.That makes backdating more difficult and is generally thought to have curbed the practice. They found that about 24 percent of stock option grants are reported late. "Backdating and camouflaged timing appear to be practiced even after SOX, especially by smaller firms." In a follow-up paper (click for PDF), Narayanan and Seyhun add: "We find that executives can increase their compensation even in the post-SOX era by playing the dating game and reporting their options late. Why else would Apple CEO , and Google CEO Eric Schmidt only ask for $1 in salary?But Sarbanes-Oxley probably has not eliminated backdating. Our findings indicate that a manager receiving a large grant of 1,000,000 shares of a typical company's stock can increase the value of their grant by about $1.23 million, or 8 percent, by reporting 30 days late." Q: Why is there this emphasis on stock options? (In fact, if Congress had simplified the tax code and made CEO salaries fully deductible, it's likely that no backdating scandal would have occurred.Of course, honest CEOs would help too.) Q: What lawsuits have been filed by investors over stock option backdating?Apple faces a number of suits filed on behalf of shareholders and pension plans in federal and state courts in California.

in salary?But Sarbanes-Oxley probably has not eliminated backdating. Our findings indicate that a manager receiving a large grant of 1,000,000 shares of a typical company's stock can increase the value of their grant by about

Academics have found some evidence that CEOs time the release of negative information to happen just before a scheduled grant date, and release positive information after a scheduled grant date. So companies can save on taxes by handing out lucrative stock options instead of lucrative salaries.

That makes backdating more difficult and is generally thought to have curbed the practice. They found that about 24 percent of stock option grants are reported late. "Backdating and camouflaged timing appear to be practiced even after SOX, especially by smaller firms." In a follow-up paper (click for PDF), Narayanan and Seyhun add: "We find that executives can increase their compensation even in the post-SOX era by playing the dating game and reporting their options late. Why else would Apple CEO , and Google CEO Eric Schmidt only ask for $1 in salary?

But Sarbanes-Oxley probably has not eliminated backdating. Our findings indicate that a manager receiving a large grant of 1,000,000 shares of a typical company's stock can increase the value of their grant by about $1.23 million, or 8 percent, by reporting 30 days late." Q: Why is there this emphasis on stock options? (In fact, if Congress had simplified the tax code and made CEO salaries fully deductible, it's likely that no backdating scandal would have occurred.

Of course, honest CEOs would help too.) Q: What lawsuits have been filed by investors over stock option backdating?

Apple faces a number of suits filed on behalf of shareholders and pension plans in federal and state courts in California.

||

Academics have found some evidence that CEOs time the release of negative information to happen just before a scheduled grant date, and release positive information after a scheduled grant date. So companies can save on taxes by handing out lucrative stock options instead of lucrative salaries.That makes backdating more difficult and is generally thought to have curbed the practice. They found that about 24 percent of stock option grants are reported late. "Backdating and camouflaged timing appear to be practiced even after SOX, especially by smaller firms." In a follow-up paper (click for PDF), Narayanan and Seyhun add: "We find that executives can increase their compensation even in the post-SOX era by playing the dating game and reporting their options late. Why else would Apple CEO , and Google CEO Eric Schmidt only ask for $1 in salary?But Sarbanes-Oxley probably has not eliminated backdating. Our findings indicate that a manager receiving a large grant of 1,000,000 shares of a typical company's stock can increase the value of their grant by about $1.23 million, or 8 percent, by reporting 30 days late." Q: Why is there this emphasis on stock options? (In fact, if Congress had simplified the tax code and made CEO salaries fully deductible, it's likely that no backdating scandal would have occurred.Of course, honest CEOs would help too.) Q: What lawsuits have been filed by investors over stock option backdating?Apple faces a number of suits filed on behalf of shareholders and pension plans in federal and state courts in California.

.23 million, or 8 percent, by reporting 30 days late." Q: Why is there this emphasis on stock options? (In fact, if Congress had simplified the tax code and made CEO salaries fully deductible, it's likely that no backdating scandal would have occurred.Of course, honest CEOs would help too.) Q: What lawsuits have been filed by investors over stock option backdating?Apple faces a number of suits filed on behalf of shareholders and pension plans in federal and state courts in California.

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