Brocade backdating options

Posted by / 12-Aug-2017 00:35

Brocade backdating options

Here is a whitepaper they co-authored with Brocade in 1999-2000.This was right before KPMG Consulting spun off from KPMG the audit firm and became Bearing Point. I remember during that heady time how KPMG Consulting leadership tried to flash the dollar signs in our eyes at every moment, attempting to attract new staff and retain existing staff with promises of riches from the stock options we would be getting in the IPO.They led the investigation which resulted in the restatements and Reyes’ resignation as CEO.But KPMG Consulting had been involved with Brocade in the past, while Andersen was the auditor. A politician, a thief and a KPMG manager died and went straight to hell. I want to call my country and see how everybody is doing there.” She called and talked for about 5 minutes, and then she asked “Well, devil how much I need to pay for the call????The devil says “Five million dollars.” The Politician wrote him a cheque and went to sit back on her chair.Previously, he had been CFO at Maxim Integrated Products, another company tainted by the backdating scandal, and was a CPA and former partner with Ernst & Young. Some involved picking dates in hindsight to give recipients a head start to profits.Some of those cases enabled new hires to receive options dated before they started full-time work.

Brocade first disclosed it had found accounting errors in its stock options granting process in January 2005.In fact, one of the main arguments for the IPO of the consulting arms of the audit firms at that time was the need to issue stock options and other stock based incentives in order to attract the technology expertise they needed to compete with the SAPs, Oracles, Scients, Viants, Razor Fish and Sapients, the dot-com technology startups that were creating billions on paper for their employees.I think the expression they used was, “to create currency” needed to attract talent and to make acquisitions of promising firms for the formerly stodgy consulting arms of the private, partnership managed audit firms that were intent on growing and expanding into global powerhouses.As an aside, here’s an interesting article in Financial Week, written prior to the verdict, about what the jury in the Greg Reyes trial didn’t hear: “Gesturing from the bench with a dismissive wave of his hand, the (Judge Breyer)concluded: “[What] these transcripts…demonstrate to me is how incomplete and inadequate and less than forthcoming people are during these calls…Why isn’t the government then entitled to show how artificial and how structured and how incomplete these discussions are which go out to the market in terms of information….But then it becomes quite a different trial.”That trial, Judge Breyer went on to explain, would become one concerned less with any specific transgressions that might have taken place with the accounting at Brocade under Mr. “[Whether] the board of directors was browbeaten…whether or not in these investor meetings the company was forthcoming…and how information was disseminated to the public and so forth.” And that, the judge seemed to suggest, is not a trial within the court’s scope.

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“The Board has selected Arthur Andersen LLP, independent auditors, to audit our financial statements for the fiscal year ending October 26, 2002…Arthur Andersen LLP has audited our financial statements annually since October 1997.” On June 18, 2002, Brocade Communications Systems, Inc.