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Twenty four hours after FASB issued its exposure draft on stock option expensing, $1.4 billion HR consulting firm Towers released a study showing that a company’s decision to expense stock options has no impact on stock price. The study tracked 335 companies, monitoring their stock price five months before and after their announcements to disclose […]

Executive compensation specialists are reporting that stock option grants will decrease due to FASB’s new stock-option expensing proposal, and will likely be replaced by restricted stock grants. According to two new studies, that trend may already be underway. Compensation analysis firm Equilar, Inc., and compensation consultants Pearl Meyer & Partners each released separate studies last […]

Spatt Carnegie Mellon University finance professor Chester Spatt was recently selected as the SEC’s chief economist, taking a two-year leave from the school. Spatt, whose appointment is effective July 1, will oversee the Commission’s Office of Economic Analysis in Washington, D.C., advising policymakers on the effect of economic regulation on the markets. Considered an expert […]

In releasing the exposure draft, Share-Based Payment, an amendment of FASB Statements No. 123 and 95, the Financial Accounting Standards Board is formally proposing a requirement for all public companies to expense employee stock options in the year they are granted. The compensation expense would be reported on the income statement using the “fair-value-based method” […]

While regulators, investors and governance experts applauded the Financial Accounting Standards Board’s decision to recommend that stock options be expensed, the reality is that it is much ado about nothing. Or, at the very least, it is another case of too little too late. First of all, the same day FASB made its announcement, Towers […]

In theory, if an organization is hauled into court and prosecuted, the fine imposed could be substantially less if the organization is deemed to have an effective compliance program in place. But in practice, that rarely happens. In fact, during the decade since the guidelines became effective, only three organizations (0.4 percent) ever received sentencing […]

As noted in prior CW coverage of the sentencing guidelines, actions like self-reporting and cooperating in an investigation could result in reduced charges, lighter sanctions, and even “the extraordinary step of taking no enforcement action.” As a result, the call for cooperation may seems obvious. But there’s a catch. According to securities experts, full cooperation […]