Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs -- Ignore unavailable to you. Want to Upgrade?

To: Ted The Technician who wrote (254)	8/23/2002 11:45:48 AM
From: hueyone	Respond to of 786

The FAS 123 intrinsic value method just determines the value once at date of grant. If the exercise price equals the market price on date of grant, which is generally the case, the value of the stock options are expensed as zero and they never gain a value thereafter regardless of subsequent stock price appreciation. The Business Week intrinsic value method, on the other hand, has a variable accounting component designed to adjust the intrinsic value of stock options to subsequent changes in stock prices over the vesting period. However, unlike the Ted Technnician (TT) method, the Business Week intrinsic value method does not properly allow a value for premium. At least this is the way I currently understand the various methods we are considering. Best, Huey