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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (16399)	8/5/2002 3:18:26 PM
From: Math Junkie	Read Replies (1) \| Respond to of 42834

"the employee has to pay taxes on the amount of the bonus and the company has to expense that form of employee compensation. this isn't the same." If the tax treatment of the two situations is not the same, then it should be, because the end result is the same. In both cases, the employee ends up with the options and no net out-of-pocket expense. "selling stock is not counted as revenue" I'm not talking about them selling stock - I'm talking about them selling options. If you say that refunding the purchase price is an expense but collecting the purchase price is not revenue, then you are not being consistent. You are treating the same type of cash flow differently depending on whether it is coming in or going out. "i don't think i argued that. what i argued is that if you pay employees options then you have legally forfeitted the company's right to the amount of money those shares would bring to the company. in the case of company a, they kept all the proceeds where company b received less b/c they had an employee compensation expense they obliged themselves to pay." What expense? How is the amount of that expense determined?