Dell Technologies Inc. Message Board

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Technology Stocks : Dell Technologies Inc.

DELL 152.40

-1.5%

3:59 PM EST

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To: Richard Tsang who wrote (87034)	12/27/1998 1:31:00 PM
From: Chuzzlewit	Read Replies (1) of 176387

Richard, you are correct in your comment about stock options being a deferred compensation (which is not included in the income statements), and that this ought to be a cause of concern for shareholders. But I disagree with your arithmetic and conclusions. First, Dell funds (and hedges) these options through the sale of puts, which similarly does not appear on the income statement. If it did, there would be considerably greater "income" than is shown (would we call this an unfunded asset?). Secondly, I think the cost basis needs to be calculated not on the difference between the exercise price and the market price, but rather on the value of the options as calculated by the Black-Scholes model. I continue to vehemently push for explicit accounting of these costs. TTFN, CTC

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