When accounting rulemakers recently gave corporate finance executives an alternative method of calculating the tax impact of stock option expensing, they may also have created an escape hatch from a weakness or deficiency finding on their internal control over financial reporting. As Compliance Week covered last week (see box at right), the Financial Accounting Standards […]
Tammy Whitehouse
Posted inAccounting & Auditing
Auditor Communications, Reasonable Assurance Studied
The Standing Advisory Group of the Public Company Accounting Oversight Board will meet on Wednesday to hash out whether the Board should consider new rules more clearly defining auditor communications and “reasonable” as it applies to the level of assurance auditors should achieve in audits. According to briefing papers published by the PCAOB staff to […]
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FASB Offers Help Calculating Tax Impact Of Expensing
Companies that don’t have the historical data necessary to properly calculate the tax impact associated with stock option expensing now have a shortcut option, courtesy of the Financial Accounting Standards Board. FASB issued a proposed staff position recently that describes the shortcut approach. It is open for a brief public comment period before FASB finalizes […]
Posted inAccounting & Auditing
FASB Offers Help Calculating Tax Impact Of Expensing
Companies that don’t have the historical data necessary to properly calculate the tax impact associated with stock option expensing now have a shortcut option, courtesy of the Financial Accounting Standards Board. FASB issued a proposed staff position recently that describes the shortcut approach. It is open for a brief public comment period before FASB finalizes […]
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SEC’s Atkins Flogs Agency For Poor Cost/Benefit Analyses
In an unusual bit of self-flagellation, Securities and Exchange Commissioner Paul Atkins delivered some blistering criticism against the SEC for issuing regulatory decisions that fail to adequately consider the cost relative to the benefit. In a recent speech to the National Association of State Treasurers, Atkins criticized the SEC for its positions on mutual fund […]
Posted inAccounting & Auditing
FASB Provides Guidance On Grant Date Communications
The Financial Accounting Standards Board has issued its much-anticipated guidance indicating companies may follow long-standing practice in setting the grant date for employee stock option awards. And while the guidance is giving companies cause for relief, it’s making accountants feel as if they’re walking on a tightrope. The guidance, issued as a proposed staff position, […]
Posted inAccounting & Auditing
Study: Slight Increase In Use Of Binomial Model; More
Companies are slowly—very slowly—considering “binomial” models for valuing stock options, instead of using the more simple Black-Scholes model. That’s according to a recent study by Aon Consulting, which found that—as of August 31, 2005—122 public companies had disclosed they were using a binomial model, up from 36 companies that used a binomial model at the […]
Posted inAccounting & Auditing
Study: Slight Increase In Use Of Binomial Model; More
Companies are slowly—very slowly—considering “binomial” models for valuing stock options, instead of using the more simple Black-Scholes model. That’s according to a recent study by Aon Consulting, which found that—as of August 31, 2005—122 public companies had disclosed they were using a binomial model, up from 36 companies that used a binomial model at the […]
Posted inAccounting & Auditing
FASB To Provide Guidance On Stock Option Grant Dates
The Financial Accounting Standards Board has promised guidance on a topic that has had stock plan administrators in a virtual panic for over a month. Under language in FASB’s expensing standard related to the valuation of stock options, the date that the options are approved by a company’s board of directors would not necessarily be […]
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Cisco Promises New Spin On Market-Based Valuations
Undeterred by its recent regulatory rebuff, Cisco Systems confirmed in a brief statement this week that it will rework its proposal for a new, market-based approach to establish a value for stock options and run it past the Securities and Exchange Commission again. ORIGINAL COVERAGE First Market-Based Valuation Techniques Nixed By SEC Related Resources Download […]