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Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs

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To: GVTucker who wrote (758)8/10/2005 12:28:39 AM
From: R2ORead Replies (1) of 786
 
There are all kinds of differences between taxable income and GAAP income

I guess I come back to taxable because selecting between alternative methods has a clear and practical metric: minimize money sent to IRS.

GAAP's advantage seems to be only that it's Generally Accepted by accountants. I am not an accountant (nor are most investors) and I have absolutely no idea how the accountants select between alternatives. I hear words like 'better', 'more fully', etc. Accountants argue for years. Although Accepted eventually, the resulting 'Principles' are far from obvious or unanimous. The final 'Principle' turns on nuances of meetings and social gatherings.

Yet stock options have been with us for centuries and it seems odd that accountants have yet to construct anything Acceptable.

I think I'd rather have the tax return, arcane though it may be, along with a worst case statement counting (just counting) the number of options that are outstanding. No fudging. No 'valuation and back tracking'. No money or expense. Just counting.
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