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To: Lizzie Tudor who wrote (177769)	5/4/2004 1:16:21 PM
From: GVTucker	Read Replies (1) \| Respond to of 186894

Lizzie, it is obvious Google is going to have tens of billions of options expenses on the books in the second quarter of life as a public company No, they aren't. Their option expense last year was a couple of hundred million. Further, if you had chosen to read the prospectus, they give you the option expense had they computed the number by the Black-Scholes method. Even using liberal assumptions that give a fairly aggressive value to the stock options increases stock option expense by another couple of hundred million. That's a far cry from the billions you're talking about.

To: Lizzie Tudor who wrote (177769)	5/4/2004 2:28:13 PM
From: rkral	Read Replies (2) \| Respond to of 186894

OT ... Lizzie, re "these volitility (sic) issues are precisely WHY there are no tradeable options for new issues. " Option exchange rules have little to with FASB accounting rules. Believe it or not, the FASB addresses this topic in SFAS 123. For example, it says ... "an entity whose common stock has only recently become publicly traded will have little, if any, historical data on the volatility of its own stock. In that situation, expected volatility may be based on the average volatilities of similar entities for an appropriate period following their going public." re "I don't think you have an answer other than the obvious - IGNORE THEM they are not real anyway" I would not say anything of the kind, since the expense is real. However, I have said expensing options does not alter shareholders' equity and (net net) cash flow. Ron P.S. Not counting cites like the above, have you ever read any part of SFAS 123, "Accounting for Stock-Based Compensation"?