Payments software provider Transaction Systems Architects Inc has blamed a former CFO for using hindsight in selecting the dates for stock option awards and says it will have to make non-cash adjustments of $17m to its accounts between 1995 and 2001.
However, an internal review by the New York-based company concluded that no member of current senior management was involved in the historical option granting practices.
It found that the stock option granting practices prior to 2003 were subject to control weaknesses and other deficiencies. Management’s consultations with board members on option decisions were not properly documented in all instances. The record of directors’ action approving or ratifying option awards was, in a number of instances, inconsistent and incomplete.
Despite all these failures, the review found no evidence of intentional misconduct.