Washington (March 3, 2004) -- House Minority Leader Nancy Pelosi, D-Calif., has joined more than 40 sponsors of a House bill that would require stock option expensing for some top executives at publicly traded companies, but would not require options for employees below that level to be counted as a cost against earnings.
According to reports, the Stock Option Accounting Reform Act (H.R. 3574), which currently has the support of lawmakers from California, Virginia and Texas, would dilute a recent proposal by the Norwalk, Conn.-based Financial Accounting Standards Board that would require the expensing of all employee stock-based compensation. The board is set to discuss its proposal on stock options at its meeting today. An exposure draft is expected this month.
A similar FASB proposal on mandatory stock-option expensing was battered down roughly 10 years ago amidst a staunch lobbying effort led by Sen. Joe Lieberman, D-Conn., and Rep. Billy Tauzin, R-La.
Several groups, including the International Employees Stock Options Coalition, have lobbied furiously against mandatory stock option expensing. Nearly 500 companies now voluntarily expense stock options.
-- WebCPA staff
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