Tax

Tax Goof Scrambles Chip Maker

Monolithic Power Systems will restate after improperly recording the tax effect of stock-based compensation.
Stephen TaubApril 30, 2008

A niche semiconductor maker said it will restate its results for the past two years to correct an error in its tax provision.

At issue is erroneous recording of the tax effect of stock-based compensation expense related to a cost-share agreement with a foreign subsidiary, said the company, Monolithic Power Systems, which makes lighting display chips used in digital cameras, cell phones, and other electronic devices.

The revision will reduce reported book tax expense for 2006 and 2007, increase reported net income for 2007, and reduce net loss for 2006.

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The company, which had $134 million in revenue last year and has a $715 million market capitalization, noted that the correction will have no cash impact.

Monolithic also said said that because of the restatement, it was able to report only operating results for the first quarter of this year.

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