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To: samim anbarcioglu who wrote (122072)7/24/2002 9:35:49 PM
From: bafi403  Read Replies (3) | Respond to of 152472
 
samim, here is a more carefully worded version. Please let me know what you think.

If a firm gives an employee health insurance (in order to buy his services and loyalty) and expenses the premium today, should it be returned to the firm as income at the end of the year if the employee does not get sick by the end of the year? Options, like insurance contracts, are contingent claims with value today regardless of the final outcome. Anything of value that is given away in a compensation package should be expensed at its market value at the time of issue.

bafi403