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Novell, Dell Face Delisting From NASDAQ
narramissic writes to tell us that Novell has confirmed receiving a delisting notice from the NASDAQ stock exchange, after the software company delayed filing its most recent quarterly report to the U.S. Securities and Exchange Commission. Dell is in the same position. Both companies, and others including Apple, are grappling with investigations of the way they issued stock options and — in Dell's case — other accounting irregularities. Both companies are appealing the delisting, which means they won't vanish from the stock exchange anytime soon. NASDAQ rules require listed companies to announce the receipt of a delisting notice.
This issue is very serious. The Senate Finance Committee recently held an investigative session on stock option backdating chaired by Chuck Grassley (R-IA). The upshot was -- of course -- to continue investigating the matter further. A video ( rtsp://video.c-span.org/15days/e090606_finance.rm ) of the investigatory session has been posted by C-SPAN, and is well worth watching for anyone interested in corporate financial shenanigans to illicitly increase executive compensation.
For those uninitiated with the process, stock option backdating is a form of option fraud whereby options which should be dated at time B (when the executive was hired, for example) but are instead backdated time A (when they are 'in the money') to insure a profit for the executive. It's crass and obviously illegal.
Watch the video and you'll enjoy seeing our representatives (on both sides of the isle) enjoying a collegial and humorous discussion on the record with those who should have been asked numerous uncomfortable questions about the practice. There are, fortunately, some very pointed questions. But the session often comes off as a giveaway to the witnesses, with senators and witnesses often laughing together at in-jokes.
If you're bothered by stock market insiders fraudulently diverting profits to their friends instead of keeping the market fair and clean, this committee session will make your blood boil.
Novell simply did not file some paperwork by the deadline because Novell is still working on stats related to awarding stock options.
Once they get those stats straight and file the paperwork, they'll be back in compliance and out of delisting danger (from this issue).
The issue of how to represent stock options (i.e., the *option* for an employee to buy stock at some pre-determined rate that may be below the market price, and may or may not be redeemed for stock) on a balance sheet is a difficult, and often debated one. Standards about how to represent them on a balance sheet have changed recently, and it's understandable about how there would be errors here. Even Apple screwed up this way (can't find the link, but it was on slashdot a month or so ago).
Why not focus on the REAL crime in accounting: the handling of pensions and health care obligations? For decades they were allowed to basically say, "hey, when it comes time to pay you, trust us, we'll have new revenues, and we'll pay you out of that". By not putting these obligations on the balance sheet now, millions of workers' pensions are at risk, and the Pension Benefit Guarantee Corporation may go bankrupt as corporations try to shuck defined benefit plans (which are stupid anyway, but I digress). For GM and I'm sure several others, the present value of these obligations would more than cancel out their entire book value, i.e., the nominal value of all assets they hold. Oops!
And this isn't about some high-paid employees getting a little extra cash. This is about *retirement money*. And they're still allowed to hide the true cost of these things.
Someone's priorities are out of order...
Apology to Ubuntu forum.
VA Linux faced a NASDAQ delisting in 2001, due to their penny-stock status (3 months of a closing price under $1.00 leads to delisting). NASDAQ gave everybody a 3-month repreive following the 9/11 bombings, by which time they managed lay off most of their employees, stop hemoraging cash, and escape delisting.
Oddly enough, that wasn't "news for nerds" or "stuff that matters" -- it was -1 troll. I wonder if it still is :)
Do you even lift?
These aren't the 'roids you're looking for.
If the battery goes off...
I am not merely a "consumer" or a "taxpayer". I am a Citizen of the State of Texas
Why not focus on the REAL crime in accounting: the handling of pensions and health care obligations? For decades they were allowed to basically say, "hey, when it comes time to pay you, trust us, we'll have new revenues, and we'll pay you out of that". By not putting these obligations on the balance sheet now, millions of workers' pensions are at risk, and the Pension Benefit Guarantee Corporation may go bankrupt [...]
Why should the government make the companies do that? They do exactly the same thing with Social Security. Just substitute "Federal Treasury" for "Pension Benefit Guarantee Corporation".
The fed "borrows" from the Social Security "trust fund", substituting special treasury bonds with ridiculously low interest rates, and these bonds are NOT included in the national debt calculation. Then the fed spends the money - which will eventually have to be made up from other taxes.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way