Will Apple Drop Another Shoe
Apple has an options problem. Bigger than it originally told investors. Now, financial statements before Septmeber 2002 can't be relied upon. The options in question were granted between 1997 and 2001. A special board committee and outside counsel will review that facts and report to the entire board.

Apple will also delay filing its SEC filing for the July quarter.

Since Apple's original reports on this matter a few week ago was inaccurate in light of today's announcement, the question is open as to what the independent board committee may find and how extensive the restatements may be. The question of tax liabilities for the difference between the correct grant price and the actual price raises the issuse of IRS payments.

The most critical unanswered question is whether any members of the current management or board were involved in the grants in a way that could open them to SEC, Justice Department or IRS investigation. If an investigation of any kind is opened, it is likely to cast a pall over the company's operations at a time when Apple is hoping for sales of new iPod Nanos and Intel-powered Macs to fire up the company's sales and drive its stock back in the direction of its 52-week high of $86.40.

Apple's near-term future can no longer be defined solely by the success of its multimedia player and computers. At least not until all the hard questions about the options grants and board or management responsibility in the matter. Some one gave the approvals.

Douglas A. McIntyre can be reached at douglasamcintyre@gmail.com. He does not own securities in companies that he writes about.