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FASB Publishes proposal on stock options to improve accounting, provide greater transparency.

In response to requests from investors and many other parties to improve the current accounting standards relating to employee stock compensation in financial statements, the Financial Accounting Standards Board has published an exposure draft, Share-Based Payment, an Amendment of FASB Statements No. 123 and 95. According to the FASB, the proposal seeks to improve existing accounting rules and provides more complete, higher quality information for investors. Comments are due June 30; the proposal is available on the FASB's Web site.

The FASB also noted that the proposal would achieve substantial convergence in this area between U.S. and international accounting standards. It says reports show that approximately 500 public companies in the U.S. are treating stock options as an expense or plan to do so in the near future. The International Accounting Standards Board and Canada recently issued requirements to expense share-based payments, including employee stock options.
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Title Annotation:accounting & auditing news; Financial Accounting Standards Board
Publication:CPA Letter
Article Type:Brief Article
Geographic Code:1USA
Date:May 1, 2004
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