Backdating brouhaha bags Bed Bath & Beyond
Susan Dickenson -- Home Accents Today, October 11, 2006
Union , N.J. – While its executives will likely get a pass, Bed Bath & Beyond has joined the ranks of more than 100 companies being investigated as part of a widening probe into the backdating of stock options to key employees.
The company said an internal investigation has turned up a sweeping pattern of backdating at the $5.8 billion home fashions superstore, forcing an $8 million charge against profits during the third quarter of this year.
After an audit by a special committee of the board of directors found 44 examples of backdating since it became a public company in 1992. Bed Bath & Beyond said it will reclassify about $66 million in the equity section of its balance sheet when it files its 10-K annual report for the current fiscal year, which closes March 3, 2007 .
BBB said the federal Securities and Exchange Commission "indicated that it would commence an info rmal inquiry" into the company's past practices. The retailer emphasized that the overall effect "will not have a material impact on the company's financial position."
The special committee said the options granting process conducted by the retailer's co-founders and co-chairmen, Warren Eisenberg and Leonard Feinstein, and ceo Steven Temares "was characterized by info rmality which lacked safeguards to ensure compliance with applicable accounting and disclosure rules."