Volume 15, No. 10


Overdosing On Options: Backdating Bedlam  "The road to hell is paved with good intentions." When it comes to stock options, truer words were never spoken - if indeed, options were ever issued with good intentions. Option plans have usually been cloaked in the guise of "alignment of management interests with shareholders." In view of the past spring's events, those appeals now appear more contrived than ever. And maybe not. In this post-Enron, post-SarbOx world, it's easy to look back at these transactions as one more example of unbridled executive greed. Some of them will be found to be just that - but it's also possible that some of these deals will be found to be less than completely malevolent. It would be surprising if every company that's being investigated or rumored to be a focus of an investigation was as guilty as they appear at the outset. Sloppy record-keeping and lack of attention to details may also play a significant role in backdating capers. The following is a look at the state of the investigations, the accounting issues surrounding backdating, and some venturing as to the endgame of the investigations.

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