Steve Jobs: co-founder of Apple dies aged 56
He really did work right up to the end, didn\’t he?
But this price allegedly should have been $21.10, thereby incurring a taxable charge of $20 million that Jobs did not report as income.
Lordy, no, that\’s not what the problem with backdated options was: although it\’s a problem.
Jobs receiving $20 million and not declaring it on his income tax, well, minor. Apple paying Jobs $20 million and not including it as an expense, thereby reducing it\’s profits, much bigger problem. That was the general problem with these backdated options.
You\’re allowed to issue an option at absolutely any price you like as a company. You\’ve just got to account for it properly. Which they didn\’t….and nor did several other companies and that\’s what all the fuss was about.
Issuing in the money options should take a slice off the reported profit. Not taking that slice off was the naughty bit.