Here is the synopsis of our sample research paper on Accounting for Employee Stock Option Schemes. Have the paper e-mailed to you 24/7/365.
Essay / Research Paper Abstract
Employee stock options schemes are not cost free to the employer. However, under certain circumstances employers did not have to account for costs in the accounts. This 7 page paper considers how and why employee stock options schemes were used and accounted for and considers the impact of FASB 123 which introduced the concept of the fair value method accounting for employee stock options as the preferred method above ARP 25 which had out forward the intrinsic value method. The paper also considered the impact and likely result of FASB 123 (R). Real company figures are used to illustrate the differences. The bibliography cites 7 sources.
Page Count:
7 pages (~225 words per page)
File: TS14_TEfasb123.rtf
Buy This Term Paper »
Unformatted sample text from the term paper:
towards the shareholders or stock holders that the board of directors have to gear their operations and decisions, aiming to increase profit and the return to the shareholder through increasing
efficiency, new ventures and careful management. One tool that is used is that of employee stock options. This has been popular in
the past as it is seen to satisfy the need for a cost effective method of remuneration as well as fulfilling a motivational roll. Stockholders have also favoured it for
the board members as it is a direct motivation for the board to work to increase the companys value and a reward that is directly in line with their results
(Davies, 1986). However, the advantages of these options are being eroded with the introduction of FASB 123(R), the revised accounting standard
for stock-based compensation. In a recent survey by Deloitte stated that they had either already reduced the number of stock options they offer due to the new standard, or were
planning to do so (Anonymous, 2005). Furthermore, only 17% had already adopted the standard, a level much lower than the early adoption of other standards I the past (Anonymous, 2005).
In order to assess the impact of this and why the new standard is seen in such a poor light we need to consider the subject employee stock options plan,
looking at what they are and the types and then consider the impact of FASB 123 (R). An employee stock option scheme will be used as a cost effective way
to reward employees and empirical research shows that were there are high market values per employee (Kalmi, 2005). There have been some arguments to reduce the employee participation based on
...