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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Amy J who wrote (67235)	3/7/2005 11:04:22 AM
From: GVTucker	Read Replies (2) \| Respond to of 77400

Amy, RE: It eventually gets deducted from earnings when exercised, correct? No, not correct. Options are not deducted from GAAP earnings, ever, as things have stood up until now. It is that very inconsistency that has irritated me. If so, then what's the underlying issue - is your concern that it gets deducted on the back end (when exercised) rather than on the front end (when issued)? No, my issue is that if it's an expense on the taxes, it should also be an expense on GAAP financials. Chambers and Barrett's position is disningenuous. How would you address the issue around lumpy quarters as well as canceled options when handled on the front end? I'm not sure I understand you here. I have no problem with options being expensed on taxes at time of exercise and being expensed at time of vesting for GAAP financials. That is just a timing issue, and isn't any different than a whole host of other timing issues on financials.