The Associated Press reports First American said it found no intent of fraud, self-interest on the part of management or directors, or intent to misstate financial results, but did find deficiencies in its date selection method, internal controls, and application of technical accounting provisions. The firm said it will take action to improve its stock option practices.
First American also said it would restate financial earnings between 2001 and 2005 and will take an additional expense in the first quarter of 2006 of about $1.9 million, according to the AP. The company said the affect of mispriced and improperly accounts stock option grants between 1996 and 2006 amounted to $35.7 million.
In addition, First American announced it will file reports by Monday for the second and third quarter of 2006, which were delayed by the investigation.
The AP said, according to its count, at least 197 companies have disclosed Securities and Exchange Commission, Department of Justice or internal investigations related to stock option backdating.