Risk & Compliance

Apple, Dell Delay Filings

The backdating ripple effect continues at major tech companies.
Stephen TaubDecember 15, 2006

Two of the world’s best-known technology companies are delaying the filing of their latest financial reports because of problems with options backdating.

Apple Computer says it is unable to file its annual report for the fiscal year ended September 30 because it needs to restate prior financial statements to record noncash charges for compensation expense relating to past stock-option grants. The maker of the wildly successful Ipod personal music player, whose stock has been soaring this year, says it initiated a voluntary independent investigation of its options practices after a management review discovered irregularities in past stock-option grants.

The company expects to file the report on or before the 15th calendar day following the due date. At that time, it will also finally file its quarterly report for the quarter ended July 1.

Meanwhile, Dell Inc. says it needs more time to file its fiscal third-quarter results for the period ended November 3 “due to questions raised” in connection with ongoing investigations by the Securities and Exchange Commission, the company’s audit committee, and the U.S. Attorney for the Southern District of New York.

The personal-computer maker said earlier that the probes are related to certain accounting and financial-reporting matters, including the possibility of misstatements in prior financial reports. Dell noted in a regulatory filing that the investigations are examining certain accounting and financial-reporting matters, including issues relating to reserves and other balance-sheet items that may affect the company’s previously reported results.

Dell stressed that the probes are ongoing, and no determination has been made as to whether restatements will be required. However, it assured investors that management is cooperating with the SEC, audit committee, and U.S. Attorney’s office, and that it is committed to regaining compliance with all SEC filing requirements as soon as possible.