The transaction should be ratified by minutes or resolutions of the participating entities.
There are some cases where this approach is not possible.
Backdating is dating any document by a date earlier than the one on which the document was originally drawn up.
Under most circumstances, backdating is seen as fraudulent and illegal, although there are some situations in which backdating can be used in a legal and beneficial way, such as backdating a claim for a past period.
As expected, the charges focused on backdating stock options by doctoring employment documents, neglecting to record the stock-option expense on the company’s books, and misleading investors.
The cascading litany of alleged charges is not likely to stop with the Brocade case.
This process occurred when companies were only required to report the issuance of stock options to the SEC within two months of the grant date.
Companies would simply wait for a period in which the company's stock price fell to a low and then moved higher within a two-month period.
The document should be dated when it is actually signed, but it can refer to the historic effective date of the transaction.In-the-money options are different from performance-based compensation in the eyes of the Internal Revenue Service and the Financial Accounting Standards Board.The process of granting an option that is dated prior to the date that the company granted that option.Documenting a transaction which has already happened One possible scenario is that the relevant transaction has already happened, but just hasn’t been documented yet.For example, there may have been a transfer of trade from one group company to another on a particular date.