Human Capital & Careers

Small Company’s CFO Quits; Options Cited

The measurement dates for certain stock options issued by Boston Communications don’t match the recorded grant dates.
Stephen TaubOctober 12, 2006

Karen Walker resigned as CFO of Boston Communications, a small company that sells billing systems to mobile-phone companies. In a press release, the company linked Walker’s resignation to its “previously disclosed internal review relating to stock option grants.”

Also apparently as result of the stock option probe, Boston Communications general counsel Alan Bouffard decided to move up his retirement date to Thursday, and E.Y. Snowden will no longer serve as chief executive officer and president. Instead, Snowden will become non-executive chairman of the company, which sells billing systems to mobile phone companies. A call by to the company seeking comment from the executives was unreturned at press time.

The company, which recorded revenues of $104 million in 2005, stated that it will need to restate its financials to record added non-cash charges for stock-based compensation expense related to past option grants. The restatements are needed because the correct measurement dates for accounting for certain option grants differ from the recorded grant dates.

As a result, the company said, users of financial statements should no longer rely upon its financials and related notes and financial data for all prior periods. That includes all annual and quarterly periods included in the company’s most recently filed annual report and quarterly report. All earnings releases, and press releases issued by the company concerning the financial statements should also no longer be relied upon.

The company named Thomas Doherty as interim CFO. He is currently executive vice president of Argus Management Corp., which specializes in financial consulting and interim management. Boston Communications added that would “promptly commence” a search for a new finance chief and CEO.

In this new position, Snowden will be responsible for mapping the company’s strategic direction, according to a company announcement.