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 Board recently proposed a new method for calculating how companies could report the tax effects of expensing stock options. They created the method in response to corporate calls for help, after many companies realized they didn’t have the historical data necessary to track the tax effect as required in the Board’s stock option expensing rule.
