Washington (April 23, 2004) -- The Financial Accounting Standards Board this week found another ally in its battle against lawmakers who want to stall its plan to make stock option expensing mandatory -- Federal Reserve Chairman Alan Greenspan.
The head of the Fed basically told Congress to butt out, according to a Reuters report. "With respect to stock options, I think it would be a bad mistake for the Congress to impede FASB in this regard," Greenspan reportedly said during a question-and-answer session following testimony before Congress' Joint Economic Committee on Wednesday.
"As best I can judge, FASB’s changes in recommendations with respect to accounting procedures strike me as correct, and it's not clear to me what the purpose of Congress is in this particular procedure."
The FASB plan has drawn the ire of some legislators and companies who say it would undermine job creation and economic growth. One bill to thwart the current FASB proposal that is under consideration by lawmakers would only make expensing mandatory for certain senior executive officers and would prevent the Securities and Exchange Commission from recognizing the FASB rule until an economic impact study is completed. The bill, H.R.3574, sponsored by Rep Richard Baker, R.-La., has gained the support of more than 100 co-sponsors.
The public comment period on the FASB proposal ends June 30. If adopted, the rule would apply to options issued after Dec. 15, 2004.
-- WebCPA staff
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