Message #14 From:
NewsBot Date: November 3, 2006 06:00:00 AM
APOL News Apollo Group Announces Update Regarding Stock Option Grants
PHOENIX--(BUSINESS WIRE)--Apollo Group, Inc. (Nasdaq:APOL) today announced that its ongoing
internal investigation into the issuance of certain stock option grants
has discovered various deficiencies.
While not yet complete, the investigation to date has identified various
deficiencies in the Company’s process of
granting and documenting stock options, which are described in greater
detail in the Company’s Form 8-K filed today.
Apollo Group therefore will need to restate its historical financial
statements to record additional charges for compensation expenses
relating to past stock option grants. The Company has not determined the
amount of such charges, the resulting tax and accounting impact, or
which periods may require restatement. Accordingly, Apollo Group today
filed a Form 8-K and plans to file any required restated financial
statements following completion of the investigation. The Company
continues to cooperate with the SEC.
“We are committed to resolving these issues as
quickly as possible, and we are in the process of putting the
appropriate processes in place to ensure this does not happen again,”
said Brian Mueller, who was appointed president of Apollo Group in
January.
Apollo Group also announced that Chief Financial Officer and Treasurer
Kenda B. Gonzales resigned on November 1st,
citing personal reasons. In addition, Chief Accounting Officer Dan
Bachus is currently on administrative leave.
“Transition is always challenging for an
organization,” commented Mueller. “However,
we have a talented and tenured executive team in place and I feel
confident in our abilities to move the organization forward. Our focus
remains on doing what’s right for our
students, our faculty and our employees. I remain committed to the
turnaround plan I outlined for shareholders earlier this year and I
believe we have made significant progress towards building the
infrastructure for our future growth.”
As previously announced, Apollo Group’s Board
of Directors has appointed a special committee of outside directors (the “Special
Committee”) to conduct an independent
investigation relating to the Company’s
historic stock option grant practices. The Special Committee consists of
two independent members of Apollo’s Board of
Directors – Hedy F. Govenar, who chairs the
Nominating and Governance Committee and the meetings of the independent
directors, and Daniel D. Diethelm. The Special Committee’s
investigation is being conducted with the assistance of outside legal
counsel, Mayer, Brown, Rowe & Maw LLP, and forensic accountants from FTI
Consulting, Inc., in conjunction with the Company’s
independent registered public accounting firm Deloitte & Touche LLP.
Apollo Group will delay the filing of its Form 10-Q for the quarter
ended May 31, 2006 until the Special Committee has completed the
investigation.
In lieu of taking individual calls on the matter, the company will hold
a conference call to review this update at 11:00 AM Eastern time, 9:00
AM Phoenix time, on Friday, November 3, 2006. The call may be accessed
by dialing (877) 292-6888 (domestic) or (706) 634-1393
(internationally). The conference ID number is 1461683. A live webcast
of this event may be accessed by visiting the company website at: www.apollogrp.edu.
A replay of the call will be available on our website or at (706)
645-9291 (conf. ID # 1461683) until November 22, 2006.
Apollo Group, Inc. has been providing higher education programs to
working adults for almost 30 years. Apollo Group, Inc., operates through
its subsidiaries: The University of Phoenix, Inc., Institute for
Professional Development, The College for Financial Planning Institutes
Corporation, and Western International University, Inc. The consolidated
enrollment in its educational programs makes it the largest private
institution of higher education in the United States. It offers
educational programs and services at 100 campuses and 159 learning
centers in 39 states, Puerto Rico, Washington DC, Alberta, British
Columbia, Netherlands, and Mexico.
For more information about Apollo Group, Inc. and its subsidiaries, call
(800) 990-APOL or visit Apollo on the company website at: www.apollogrp.edu.
