Apollo Group announced that the Securities and Exchange Commission has completed its investigation of the company’s stock option granting practices. The for-profit education company best known as the operator of the University of Phoenix said the regulator does not intend to recommend any enforcement action. Company officials did not provide any further statement or information.

In June of 2006, the SEC launched an informal probe into Apollo’s options practices. In addition, the company received a subpoena from the United States Attorney for the Southern District of New York relating to stock option grants. By November, Apollo disclosed that an internal investigation had “discovered various deficiencies” in its process of granting and documenting stock options, and added that it would restate prior results.

The company also announced at that time that chief financial officer and treasurer Kenda B. Gonzales had resigned “for personal reasons.” Joseph D’Amico, senior managing director of interim management company FTI Palladium Partners, took over the CFO position. Apollo also placed chief accounting officer Dan Bachus on administrative leave. Earlier that month the company appointed Brian L. Swartz as vice president, corporate controller, and chief accounting officer.

In December, Apollo disclosed that a seven-month investigation by a special committee of outside directors found that certain former officers took steps that may have been intended to mask failures in the approval process for stock-option grants. The company added that the potential cover-up involved the Apollo’s financial reporting and payment of taxes. Apollo stressed that none of these findings applied to any member of its then current executive team.

In February, Apollo disclosed that accounting revisions, including adjustments for non-cash equity-based compensation charges, would have “a material adverse impact” on its previously reported financial results. Other potential adjustments may reflect revisions to bad debt reserves, accruals for Title IV lender refund reimbursements, completion of the company’s annual goodwill impairment review as of August 31, 2006, and other accounting policy changes or refinements.

Meanwhile, Apollo also announced last week that its board’s compensation committee was authorized to award to 13 executive officers a stock option grant to purchase shares of the company’s common stock and a restricted stock unit award for additional shares of common stock. The awards were made under the Company’s 2000 Stock Incentive Plan. Among the finance executives, D’Amico received 500,000 options and 60,000 restricted stock units; Swartz received 60,000 options and 10,000 restricted stock units, while Larry A. Fleischer, vice president of finance, received 45,000 and 7,000.

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