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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 76.22

+0.1%

Nov 24 3:59 PM EST

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To: RetiredNow who wrote (67193)	3/5/2005 12:07:16 AM
From: rkral	Read Replies (3) of 77400

mindmeld, re "They are required to report EPS on a fully diluted basis for one thing. " $250 million per quarter is (my estimate of) the after-tax impact on CSCO's net impact. Actually, that's the per quarter average of all after-tax hits over a 16 quarter period. You can divide that by your estimate of diluted shares to obtain diluted EPS. BTW, fully diluted EPS is no longer used. It was 'primary EPS' and 'fully diluted EPS' until 1998. Since then it's 'basic EPS' and 'diluted EPS'. See SFAS 128. re "For another, they must report all expense associated with all outstanding options. " They must report using a "modified prospective" method, which means ... going forward ... they report as if they had been expensing per SFAS 123R all along. re "That expense would hit in one quarter only, if the options program were halted completely. Why do you think they would continue for 16 quarters?" CSCO options vest over 4 years (some over 5 years) and options expense is amortized over the vesting period. Ron

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