Intel shareholders vote to expense options

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FASB has studied this for years

"We believe this is a deeply flawed method of accounting that will diminish the accuracy and clarity of our financial reporting and could cause real economic harm to Intel, our stockholders, and our economy,"

How about you put it as a separate item in the accounts then, let the shareholders (remember them? they own the company or something) decide if that number is useful and accurate or otherwise!

There's a commentry on it here:

http://www.fool.com/news/commentary/2003/commentary031112bm.htm

"If Congress gets out of the way and allows the Financial Accounting Standards Board (FASB) to do its job of making the standards of accounting, the FASB intends to release an exposure draft in February stating that every American company will be required to show an expense for employee stock options in 2005. By so doing, the FASB will close a historical loophole that treats one form of compensation differently than any other.

"A decade ago, Congress, led by Sen. Joe Lieberman of Connecticut, threatened to pull official recognition of the FASB if it tried to push through a requirement to expense. The FASB blinked, and company usage of stock options took off like a shot. We're back to that point again.

"The scandals and declining quality of corporate accounting, the public's tiring of the compensation executives receive regardless of company performance have emboldened the FASB to join the fracas once again.

"You're going to see gross pieces of stupidity, such as Calif. Sen. Barbara Boxer's statement that "we can't stand by and let accountants wearing green eye-shades decide who is going to get the American Dream." If this sounds like a talking point spoon-fed by a lobbying group, consider this component of a letter-writing campaign sponsored by the American Electronics Association (AeA), a major high-tech lobbying group:

"AeA has concluded that, if companies are forced to expense options, current stock option plans will be severely reduced or completely eliminated for rank and file workers.

"You know why AeA can make such a claim? Because its member companies, which include such tech behemoths as Cisco (Nasdaq: CSCO), Intel (Nasdaq: INTC), Apple (Nasdaq: AAPL), and Applied Materials (Nasdaq: AMAT), have overwhelmingly told it that's what they would do. So you end up with a strange, vaguely menacing quote by Boxer that is completely unresponsive to the actual issue...."

Posted by: Nigel Johnstone   Posted on: 05/19/04 You are currently: a Guest | Members login | Terms of Use

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