RIM chairman resigns amid restatement

06 Mar 2007

(Associated Press via NewsEdge) BlackBerry maker Research In Motion's co-chief executive will give up the chairman's post after an internal probe identified a quarter-billion dollars in improper accounting for employee stock options at the mobile device company.

Jim Balsillie, who will remain on RIM's board, and co-CEO Mike Lazaridis also will pay up to $4.25 million apiece to defray the cost of the internal investigation, and return an as-yet undisclosed amount of personal profit from backdated options.

As a result of the improper accounting, the company expects to restate three years of past financial statements to record roughly $250 million of options-related expense that should have been deducted from the Ontario-based company's profits.

Owing to the expanded scope of the revisions, RIM said it would need more time to complete the restatement, which it had hoped to finish this month.

RIM also announced a change in chief financial officer in its detailed update, one of the highest-profile admissions of ethically suspect practices among the more than 100 companies implicated in Wall Street's options-backdating scandal.

But the announcement also demonstrated, similar to Apple's recent acknowledgment of backdated options, how the scandal's consequences tend to be less severe for companies and senior executives when business is good.

Where other executives have lost their jobs, and the stocks of implicated companies have fallen, both Balsillie and Apple CEO Steve Jobs have emerged relatively unharmed. Shares of RIM and Apple have both risen sharply.

© 2007 The Associated Press

© 2007 Dialog, a Thomson business. All rights reserved

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