oboloo Glossary

Stock Options Accounting

oboloo Glossary

Stock Options Accounting

Stock Options Accounting is the process of tracking and recording employee stock options issued by a business. The goal of this accounting practice is to accurately document the costs associated with granting stock options as well as any subsequent changes in value that occur. When calculating these costs, businesses must account for the market rate, exercise price, and expiry date of each option granted. In addition, a thorough understanding of relevant tax laws and regulations is essential when creating stock option accounting systems. Investing in stock options can be a great way to motivate employees and align their financial interests with that of the company – but it’s important to make sure everything is properly accounted for.