Friday, January 8, 2010

Organisations need to consider the likely life of option and not the total life of the option

ESOP valuation for financial reporting

Providing for ESOPs as expense has a significant impact on the determination of distributable profits for dividend declaration, calculation of EPS (earnings per share), determination of profits for senior management remuneration, and payment of MAT (minimum alternate tax), observes Mihir Gada, Associate Director, Transaction Advisory Services, Ernst & Young.

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