I can confirm this bug on Ubuntu 12.04.5 host with the following guests:
* Ubuntu 12.04.5 i386 guest (default qemu-kvm = "kvm -m 1024 -cdrom 
ubuntu-12.04.5-desktop-i386.iso" )

** Attachment added: "Ubuntu 12.04.5 i686 guest, default kvm.png"
   
https://bugs.launchpad.net/ubuntu/+source/linux/+bug/1080674/+attachment/4359601/+files/Ubuntu%2012.04.5%20i686%20guest%2C%20default%20kvm.png

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You received this bug notification because you are a member of Ubuntu-X,
which is subscribed to xserver-xorg-video-cirrus in Ubuntu.
https://bugs.launchpad.net/bugs/1080674

Title:
  [QEMU] Corrupted desktop screen for raring desktop installation in
  QEMU guest (Cirrus graphics).  Affects KVM but not VBox.

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