Enterprise spend management software developer Ariba Inc. will restate its financial statements for the fiscal year that ended Sept. 30, 2001, and for the quarter that ended March 31 of the same year.
The restatement is a result of the companys ongoing audit committee review, officials said in a release earlier this week. The review is focusing primarily on a $10 million payment to Larry Mueller, the companys former president and CEO. Aribas chairman and co-founder Keith Krach authorized the payment.
Because no company funds were used and there was no commitment from Ariba, the company originally viewed the payment as a personal transaction, officials said. But Ariba said its audit committee has now decided to treat Krachs $10 million payment to Mueller as a capital contribution to the company from Krach and a payment of compensation from the company to Mueller.
The payment does not affect the companys operating results for the 2002 fiscal year or for the quarter in which it occurred, officials said. Rather, the restatement will reflect a non-cash charge to Aribas 2001 operating expenses.
As a result of the investigation, Ariba, of Sunnyvale, Calif., also delayed the filing of its annual report for fiscal year 2002 – which was due Dec. 30, 2002 – until the review is complete.