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To: L. Adam Latham who wrote (169626)	8/20/2002 3:32:00 AM
From: hueyone	Respond to of 186894

The FASB is currently leaning away from this with their latest announcement. Both your posts appear to imply that the FASB does not believe that stock options should be expensed on the income statements. Perhaps that was not your intention, but I strongly disagree with that implication. I beleive the opposite is true. Now whether the FASB will ever find the political atmosphere conducive enough for them to make their independent recommendation again without being harrassed out of existence by Congress, is another question. I think the lobbying against forced expensing of stock options will be much more vocal than those for the issue. I would substitute the word "rich" for "vocal". Larry Ellison is particularly involved in lobbying against expensing stock options, and he alone has over 700 million dollars from unexpensed stock options to fight this battle (just from fiscal 2001)---as defined by the difference between market and strike at time of exercise as opposed to the fair value Black Scholes approach at grant. You may well be right that this business lobby will be overpowering again---to shareholders detriment in my opinion. Someone mentioned that the IASB may be in favor of expensing options, but the FASB is the standard for U.S. companies, and I don't think the FASB will defer to them. The FASB is working very closely with the IASB to try to set common standards for accounting. Best, Huey