Corporate board members, including compensation and audit committee members, who themselves could be subject to investigation into backdating, may look to CFOs and senior finance executives to organize internal audits of stock option
award policies and review accounting methodology.
422(a)(2) states that the employee must have been an employee beginning on the date that the option
was granted and up to three months prior to exercising the option
To estimate the fair value of employee options
, companies must use an option
-pricing model such as Black-Scholes-Merton or lattice.
Under FAS 123(R), the fair value of a stock option
is based on observable market prices, if they exist.
Don Faurot, then coaching at the Iowa Pre-Flight School in Des Moines, decided to utilize the option
as the focal point of his Split-T offense.
Managing risk for opportunity increasingly involves investment timing and options
Microsoft's recent decision to replace options
with restricted stock overturns a host of market myths and paves the way for new thinking about incentives.
In the lingo of the options
market, it was "out of the money," or worthless, since investors would not exercise an option
to buy shares at $140 when those shares could be acquired for $139.
For an option
to qualify as an ISO, the exercise price cannot be less than the fair market value of the stock at the time the option
usage, at 90 percent, still remains well ahead of restricted stock, the second-most popular vehicle, used by two-thirds of companies.
Freddie Mac countered that a mortgage originator received an option
to sell a mortgage to it in return for the commitment fee; thus, the fee was an option
A lattice model assumes the price of stock underlying an option
follows a binomial distribution, a type of probability distribution in which the underlying event has only one of two possible outcomes.
This appears to reverse past practice, but we attribute it to the custom at many companies of making a large option
grant one year and then skipping the next.
It all must start with the QB making the correct option
read on the LOS
LOS ANGELES -- Investor's Business Daily (IBD) today launched the IBD([R]) Option
Center on Investors.