The accounting for employee stock options under US Generally Accepted Accounting Practice GAAP is particularly complex
companies need to carefully plan their stock options schemes otherwise they could end up with a significant and unintended charge to earnings.
With the use of employee stock options becoming more widespread, and a greater number of Asian companies tapping into the US capital markets, which then usually requires them to prepare their accounting information under US GAAP, this issue is becoming increasingly important. This article sets out some of the basic considerations for accounting for employee stock options under US GAAP.
One of the main reasons for the widespread use of employee stock options...
