Backdating probe

When it comes to the complex and, at times, sensitive matter of stock-option grants for top executives, HR can ill afford to trust that everything will be just fine if they let others worry about the details.With the mushrooming of federal probes into questionable options grants -- as well as a few high-profile allegations of direct HR involvement in fraudulent cases of options-grants backdating -- it's time to jump in with both feet.

The SEC’s opinions regarding backdating and fraud were primarily due to the various tax rules that apply when issuing “in the money” stock options vs.

the much different – and more financially beneficial – tax rules that apply when issuing “at the money” or "out of the money" stock options.

Editor’s Note: Journalist Philip Moeller, who writes widely on health and retirement, is here to provide the Medicare answers you need in “Ask Phil, the Medicare Maven.” Send your questions to Phil.

Medicare rules and private insurance plans can affect people differently depending on where they live.

(Headlines)The Dallas technology outsourcer acknowledged May 10, after a preliminary internal probe, that it had issued executive stock options that carried "effective dates" preceding the written approval of the grants.

ACS said it plans a charge of as much as million to rectify its accounting related to the grants. Edwards signed separation agreements with ACS that will allow them to remain with the company during a transition period ending June 30, 2007.It is being examined by the Securities and Exchange Commission. 7, the company announced that investors should no longer rely on its prior disclosures about the findings of its continuing internal probe. Noncash compensation costs related to backdating will be about million, plus additional tax-related expenses.It had previously said a preliminary review suggested no intentional backdating occurred and any charges were likely to be minor. (Headlines) (Options chart) The maker of gene-testing devices said on Aug 1 that an internal probe has uncovered "certain documentation lapses" in its stock options grant processes from 1997 through 1999, including one instance when the option grant date should have been recorded differently.And the murkier realm of spring-loading grants could pose more headaches -- and legal hazards -- for HR because it is so much more ambiguous than backdating.It all adds up to a loud wake-up call for HR executives, alerting them to the necessity not only of knowing when to sense a legal hazard, but to act proactively to prevent their organizations and executives from being wiped out by the next big wave, or even the last old one.Phil Moeller: This is a deceptively complex question. If you are 65 or older and file for Social Security, the government will consider you to have also filed for Medicare.

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