Vesting Period

CFA Level II
#1

What is it?

#2

i grant u stcok option but there is a kind of waiting period so to force u to stick around …like 100 stcok option but u earrn 20 per year and can only excercise after full vesting period…amkes sssense?

#3

Perfect sense, thanks man

#4

and i believe you will expense the stock option over the vesting period. Say the stock option has a fair value of $100 at grant date and the vesting period is 5 yrs, you would expense 100/5 = 20 per year.

#5

how does vesting period differ from service period? i believe the text says that the fair value of the stock option is put on B/S as compensation expense over SERVICE period—so vesting and service period are diff?

#6

anyone ? i personally believe a service period is equal to its vesting period

#7

They have to be the same, since vesting period I know is correct.