The Wall Street Journal reports that crafts retailer said the discovery will require reclassification of certain financial results but it does not expect to make any restatements. The company announced last week that it was delaying its latest quarterly financial results due to an internal investigation into its stock option practices (See Michael’s Is Re-examining Past Stock Options Grants ).
Michaels said it changed its practices in 2001 to give options awards on set dates, and its investigation did not uncover any irregularities since then, according to the WSJ. The company did not specify which options were involved or which executives got them.
The company’s practice had been to account for “certain non-routine grants” as if they were awarded on the date a board committee voted for them. However, Michaels said, the strike price of the options was based on an earlier “effective date” of the options. According to the WSJ, a spokesman for the company declined to say when or how that effective date was chosen.
In other developments, Monster Worldwide Inc. has said the Securities and Exchange Commission has asked it to “preserve all relevant information” about timing of stock option grants. Monster announced its own internal investigation on Monday (See Monster, Apollo Group Join Companies Investigating Stock Options ).