FASB Proposes Mandate on Expensing Stock Options (finally)

[papau]

http://ap.tbo.com/ap/breaking/MGAK6EHKHSD.html

Rule-Setting Board Proposes Mandate on Expensing Stock Options
By Marcy Gordon
The Associated Press

WASHINGTON (AP) - The rule-setting board for accounting on Wednesday moved toward requiring companies to deduct from the bottom line the cost of stock options given to executives and employees, an action with profound consequences for profits and executive pay in corporate America.<snip>

Stock options are blamed by some for aiding the corporate abuses of recent years, by enticing executives at companies like Enron and WorldCom to manipulate earnings to boost the stock price and then sell their lucrative personal holdings.

A decade ago, the FASB's attempt to push through a similar change was blocked by lawmakers. Now opponents of mandatory expensing of options - especially high-tech companies that donate heavily to both political parties - are staging an all-out effort legislative and lobbying effort to head off the move.

Bipartisan legislation gaining strength in the House would limit required expensing of options to those owned by the top five executives in a corporation. It would also prevent a new FASB mandate from taking effect until an economic impact study was done. (snip>

[rapier]

1. notes

Apparantly this will not be blocked by congress, this year. After the election is another story. However many companies are being forced to make the change anyway by shareholders. Without the law the death of the option scam may be slower but the end is in sight.

The only chance congress will kill this is if stocks can stay on an extended bull run. The chances of that are not too good.

[Name removed]

2. Deleted message

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[papau]

3. I hope you are correct - the Usual we take jobs to China if there's a FASB

change warning is on all the media outlets for last few hours!

If I had talent - in anything - I'd be happier - indeed ability in proofing my own posts would be a nice place to start!