Valeant Pharmaceuticals International
, a research-based specialty pharmaceutical company, said Monday it will restate its financial statements for certain prior periods due to errors in the company's accounting for stock options.
As a result of a review, the company found that it should have used different measurement dates for the purpose of computing compensation expense for stock option grants in 1997 and subsequent years.
The majority of errors in accounting for options pertain to those granted prior to the change in board and management in mid-2002, Valeant said. Errors also were noted in accounting for certain options granted to employees since the change of the board and management, but none of the errors related to options granted to the current chief executive officer or chief financial officer of the company, the company added.
The Costa Mesa, Calif. based company also said it will announce third quarter financial results on Nov. 2 and added these will be preliminary because of the pending restatement. The results will exclude the impact of any additional options expense until the company completes its review.
Valeant does not expect to file its Form 10-Q for the quarter ended Sept. 30 by the due date. The failure of the company to remain current in its periodic reporting obligations could have material adverse consequences including compliance issues on its outstanding convertible and high-yield notes.
As reported, the company received a request from the SEC for data on its stock option granting practices since Jan. 1, 2000 as part of an informal inquiry. The company initiated a review of its option grants and continues to cooperate with the SEC inquiry.
Shares were down 12 cents, or 0.6%, at $19.66 Monday.
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