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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club

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To: Sun Tzu who wrote (4446)4/12/1999 10:44:00 AM
From: Investor2  Read Replies (1) of 15132
 
RE: "In other words, companies are lowering their operating costs by paying their staff in options. Then they do a "buy back" or more often a synthetic buy back to cover the dilution issue without properly showing this slight of hand in the financial statements."

Salary is an expense which is directly offsets revenues and therefore reduces both profits and taxes. How do these "synthetic buy backs" influence corporate taxes?

Best wishes,

I2
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