Diligent may need to review accounts

Last updated 11:07 21/02/2013

Relevant offers


Runway extension: Mayors excited but Joyce not ready to loosen purse strings Kiwi Regional Airlines tossing up Tauranga and Napier flights Retailers welcome plan to recycle soft plastics MBIE outlines preferred options for Financial Advisers Act overhaul UDC Finance reports bumper profit CentrePort 'plenty big enough' for public listing NZX-listed wine company Delegat Group opens office in Shanghai Auckland mall space 'explodes' as new retailers demand more space Christmas spending hopes high, despite economic storm clouds Temporary Jetstar terminal moved into place at New Plymouth Airport

New Zealand-listed and US-based software company Diligent Board Member Services has received a report from a major accounting firm but still can't say whether it will need to restate its accounts for the 2012 year and some prior years.

The report made no clear recommendations on whether adjustments needed to be made and the company has extended its trading halt on shares for a further day while it reviews with advisers and its auditors, what it should do.

Last month a special committee of the company's independent directors announced too many employee options had been issued, particularly to chief executive Alessandro Sodi.

The awards were apparently inadvertently in excess of caps on Diligent's 2007 and 2010 Stock Option and Incentive Plans, and would be cancelled.

Before the trading halt was imposed Diligent shares changed hands at $5.35, valuing the company at a $448 million.

In a statement to the NZX this morning Diligent said the report raised "complex accounting issues for consideration as to how previous years' and the current year's accounts may be affected".

It would inform the market as soon as possible what it planned to do but said the board was "in the process of taking a variety of steps to seek to avoid similar issues occurring in future", including adding extra internal and external resource on compliance.

It's also working on alternative compensation packages for the affected employees that don't exceed the value of the cancelled options but also don't see the executives suffer a financial penalty.

In 2009 an option award to Sodi exceeded the maximum allowed by 1.6 million share options, and a 2011 award exceeded the cap by 2.5 million.

Ad Feedback

- BusinessDay.co.nz

Special offers

Featured Promotions

Sponsored Content