Sonus Networks has recorded a compensation expense of approximately $54 million to correct errors in the way it accounted for stock options granted from 2000 through 2005. The company recorded the charge in its newly filed regulatory filings, which had been delayed while it reviewed the dates assigned to those grants.
The maker of Internet telephony equipment and software is now up-to-date with its regulatory filings. Earlier this week, the company filed its 2006 annual report, as well as quarterly reports for the second and third quarters of 2006 and the first quarter of 2007. With these filings, Sonus says it is once again in compliance with the listing requirements of the Nasdaq Global Select Market; although it is waiting for Nasdaq’s compliance confirmation.
Sonus had previously announced it incorrectly accounted for certain stock-option grants issued from May 2000 through 2005. In its restatement, the company decreased net income by about $55 million for the period 2000 through 2005, including an additional cumulative noncash, stock-based compensation expense of roughly $54 million. It also reduced total shareholder equity by $1.4 million as of December 31, 2005.
In August 2006, Sonus announced it would not issue its most recent quarterly report because it was undertaking a voluntary review of how it had issued and accounted for past stock options. Three months later, the company’s audit committee finished its investigation with the help of independent advisers and determined that a restatement would be necessary.