To: TimbaBear who wrote (38925 ) 8/13/2002 11:46:58 AM From: Casaubon Read Replies (1) | Respond to We're halfway there.the company would have recorded an expense it didn't have....and you believe this promotes clarity in reporting? clarity in reporting , though I believe options expensing will lead to greater clarity in accounting. The point has only been options expensing. Wherein, we agree on the method of expensing at exercise. We do not agree on Black-Scholes, as you do not seem to understand it.in lieu of potentially earning a higher cash salary (elsewhere) up front , with the expectation of greater rewards sometime in the future , through stock price appreciation .Under the system I propose, where the company is not allowed to have shareholder dilution due to option exercise still would not have incurred any expense due to the strategy Also, if the employee never exercises, there was still value to the company because the employee chose to remain working for said company instead of a competitor . The option grant kept the employee at the company while limiting labor costs. That value needs to be expensed and Black-Scholes works to estimate the cost to the investors.Black-Scholes may have more effective utilization in options(puts and calls) pricing and evaluation.
