CFAI consistency on option expensing practices
Though a minor quip, I think it’s notable that new to this year’s LII curriculum is
Reading 25: FAS 123(R) - Accounting for Stock-Based Compensation: Happy Anniversary?
which supports the following LOS:
a. explain the key features of stock option accounting in the United States;
b. describe the differences between the U.S. and international standards of accounting for stock options
Both LOS are current and relevant, observing the transition to FAS 123(R), great. So but then in what I can only reason is a sloppy oversight, they include the following passage in
Reading 40: Equity: Concepts and Techniques (Volume IV, p.119-120):
“In the United States, footnote disclosures are required, but recording of an expense is optional for most stock options.” … “This matter is getting wide attention, and some U.S. firms have recently decided to voluntarily begin recording an expense for such stock options allocation.”
Anyway, Reading 40 is copyrighted in 2004, which if I remember correctly is the year that FAS 123 was revised.
It just seems odd to me to require us to know current practices under FAS 123(R) and yet in a later reading present material that appears to be related to APB 25 w/o even footnoting how things have changed and/or stand in contrast to Reading 25.
Have I missed something, or is this a legitimate grievance?
Study together. Pass together.
Join the world's largest online community of CFA, CAIA and FRM candidates.