Again, 964-based, it’s a real head-turner that attracts attention where it goes.To the casual onlooker, it comes across as something from the 1960s, an old racecar perhaps, while sticklers for originality will surely sniff at its mismatch of styles and influences.
This is a way of repricing options to make them valuable or more valuable when the option "strike price" (the fixed price at which the owner of the option can purchase stock) is fixed to the stock price at the date the option was granted.Some of this plastic surgery was more effective than others but, in most cases, the effect was spoiled somewhat when you hopped into the cockpit and were confronted by early-style seats and instruments – things that were harder and more expensive to update than the bodywork.It all sort of made sense, though, because people want the latest thing, don’t they?When company executives discovered that they had the ability to backdate stock option grants, thus making them both tax deductible and “in the money” on the date of actual issuance, the common practice of stock option backdating for financial gain began on a widespread level.The problem with this practice, according to the SEC, was that stock option backdating, while difficult to prove, could be considered a criminal act 6.The SEC’s opinions regarding backdating and fraud were primarily due to the various tax rules that apply when issuing “in the money” stock options vs.
the much different – and more financially beneficial – tax rules that apply when issuing “at the money” or "out of the money" stock options.
One of the larger backdating scandals occurred at Brocade Communications, a data storage company.
It was forced to restate earnings by recognizing a stock-based expense increase of $723 million between 19, after allegedly manipulating its stock options grants for the benefit of its senior executives.
Well, when it comes to Porsche 911s it seems that they don’t any more.
Today, the in-thing is to take a newer 911 and make it look like a previous one.
Additionally, companies can use backdating to produce greater executive incomes without having to report higher expenses to their shareholders, which can lower company earnings and/or cause the company to fall short of earnings predictions and public expectations.