New York (Aug. 23, 2004) -- The Financial Accounting Standards Board reportedly reaffirmed the basis for classifying stock option pay as equity, not a liability, effectively ruling out the possibility that companies would be able to adjust options expense to reflect how much employees actually get.

While some analysts have argued that companies should book options as a liability -- an approach that would enable companies to account for changes in the value of the options over time -- the FASB plan, viewing options as equity, would force companies to record options on their income statements with a grant-date estimate, Dow Jones and the Associated Press reported.

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