Accounting For Stock Based Compensation.....sure question on the exam..???????

All, Can any one explain or summerize the entire topic into two LOSs; 1. Key feature of stock option accointing in US 2. Difference between US & International std of accouting for stock option. I read this many times but nothing is going into my head. I think there gonna be one or more questions on this topic in FSA… Thanks in advance…

  1. This is a pretty big topic… you should probably just study it again. 2. Generally the US accounting rules are more flexible than the international ones. Under IFRS #2 you must value each segment of awards with graded vesting separately, whereas under GAAP you can do that or you can just lump all the options together as one award. Additionally, under US GAAP there is a discount window of 5% that companies can offer stock to their employees under a stock purchase plan. Finally, tax benefit shortfalls have to be recognized in the income statement under international standards. In the US, shortfalls reduce additional paid-in-capital from other tax benefits first, then go to the income statement.