Employee Stock Options: Tackling Complex Tax, Accounting, and Valuation Challenges

Navigating IRC Section 409A, FASB Requirements, and the AICPA's Practice Guide to the Valuation of Options

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A


Conducted on Wednesday, March 25, 2020

Recorded event now available

or call 1-800-926-7926
Program Materials

This webinar will give tax advisers, corporate tax professionals, auditors, and valuation professionals a detailed review of the IRS rules and financial accounting standards that impact the reporting, issuance, and receipt of employee stock options. The panel will discuss qualified vs. nonqualified options, valuation, share-based payments, and other recent updates.

Description

The practice of granting a company's employees the option to purchase stock in the company is widespread. Employee stock options are either qualified or nonqualified. Each class has its own unique set of tax, accounting, and valuation rules.

"Fair value" is the required measurement objective for stock options under FASB's ASC 718 and is reported as compensation expense by the issuing company. This standard is generally under scrutiny by financial statement auditors, the SEC, and other regulatory agencies.

The IRS requires that options have an exercise price equal to or higher than the fair market value of the underlying common stock as of the grant date to avoid harsh tax consequences to the company and the employee. This is in addition to the regular tax rules for recognition of income and expense.

Listen as our group of experienced advisers provides a detailed review of stock option issues, including valuations of companies with complex equity structures, M&A and IPO matters, and meeting ASC 718 reporting requirements.

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Outline

  1. Overview of authoritative guidance: IRC 409A and ASC 718
  2. Valuation methods
  3. Reporting: tax and accounting standards
  4. Recent developments

Benefits

The panel will explore these and other relevant issues:

  • Qualified (incentive stock options) vs. nonqualified options
  • Tax and financial statement treatment of options
  • Valuation methods
  • Required reporting and disclosures
  • Recent controversies

Faculty

Guadiana, James
James A. Guadiana

Partner
Barton

Mr. Guadiana focuses his practice on the tax aspects of domestic and international transactions and investments. He...  |  Read More

Kuczmarski, Justin
Justin Kuczmarski, MBA, CPA, CVA, ABV, CEIV, CIRA, CFF

President
NAV Valuation & Advisory

Prior to founding NAV, Mr. Kuczmarski served as an NYC Practice Leader in Financial Advisory Services for a top 10...  |  Read More

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