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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 176.740.0%10:41 AM EST

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To: Wyätt Gwyön who wrote (121977)7/23/2002 8:24:18 PM
From: cfoe  Read Replies (2) of 152472
 
FNM Fannie Mae CFO recommends expensing stock options (67.35 +0.35)


There are a number of things troubling me (a former cpa) with this drumbeat to expense options, but I heard a new one yesterday (not from a talking head on CNBC).

What happens if the options are under water and expire unexercised. Does the company get to take the expense back as income? Or is the expense only recognized when the options are exercised vs. granted. I guess I am not clear on this.

Another issue was raised by a colleague of mine. With many current options under water, aren't many folks working for much less compensation than they thought they were?

Finally, while expensing options looks like the solution to a problem, I think people ought to try and look into the future and see what problems this solution will create. I guarantee you it will create new problems.
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