BPO Company: We’re A-OK on Pay

After a probe of the company's stock-option accounting practices, the SEC gives TeleTech a clean bill of health.
Stephen TaubJuly 23, 2008

TeleTech Holdings, a prominent business-process-outsourcing company, reported that the Securities and Exchange Commission will not take any action against it after reviewing the company’s accounting for stock-based compensation.

Teletech, which recently became current in its regulatory filings after restating its results dating back to its 1996 initial public offering, also stated that it’s now in full compliance with Nasdaq filing requirements. Last week, the company filed all of its delayed reports, including its 2007 annual report and quarterly reports for the periods ended September 30, 2007 and March 31, 2008, with the SEC.

Last November, the call-center corporation informed the SEC that it wouldn’t file its September 2007 quarterly report on time because Teletech’s audit committee was conducting a review of its stock option grants and other equity-based compensation practices. The company also warned that its financials for 1999 through 2006 and the first and second quarters of 2007 shouldn’t be relied upon.

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In February of this year, TeleTech reported that its audit committee concluded that incorrect measurement dates for certain equity grants were used from the company’s 1996 IPO through August 2007. It also stated that its total restatement for equity-based compensation expense was $59.7 million, pre-tax. Most of the adjustments affected periods before 2001.

As part of its restatement process, TeleTech also reported that there were accounting adjustments for lease and other items for 1996 through June 2007 that totaled $5.6 million for the entire period on a pre-tax basis. The majority of these adjustments also affected periods before 2001.

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