Apple’s previously announced internal investigation took a turn on Thursday as the company said it has found additional evidence of irregularities, which will likely cause them to restate earnings. The company also said it would delay the filing of its Form 10-Q for the quarter ended July 1, 2006.
Apple management, the audit committee and the board of directors all agree that the company will likely need to restate its historical financial statements to record non-cash charges for compensation expense relating to past stock option grants. Apple said it didn’t know the amount of charges, the resulting tax and accounting impact, or which periods may require restatement.
As a result of the investigation, Apple said that financial statements and all earnings, press releases and similar communications staring on September 29, 2002 should not be relied on.
Apple first found the stock option irregularities in late June and notified the U.S. Securities and Exchange Commission and hired outside attorneys to perform an investigation.
Apple has since been the subject of two lawsuits due to the irregularities.
In its fiscal third-quarter earnings, reported July 19, 2006, Apple said it didn’t expect any material adjustment to the financial results because of the investigation.