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US GAAP Accounting for Share-Based Compensation (2 days)

Course Details

Code:2282
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Introduction

This two day course will provide delegates information on the important requirements concerning how to account for share-based compensation. Our specialist instructor will explain clearly and simply with examples, the logic of ASC 718. The course answers questions such as:

  • How to distinguish equity awards from liability awards
  • How to properly document the grant date
  • How to correctly account for share-based instruments including restricted stock, stock options with cliff vesting and graded vesting, non-qualified stock options, incentive stock options and employee stock purchase plans.
  • What valuation model to choose.
  • What issues arise with repricings, modifications, settlements of awards.
  • How to account for deferred tax issues including APIC pools and the interaction of ordinary NOLs and stock option NOLs.
  • How to calibrate expected term and volatility.
  • The significant differences between ASC 718 and IFRS 2.

Learning Objectives

  • Understand the logic behind the accounting for share-based compensation
  • Comprehend how to distinguish equity from liability awards
  • Learn how to choose the appropriate valuation model
  • Understand the issues in computing expected term and volatility
  • Learn how to account for awards with service, performance or market conditions
  • Become familiar with the accounting for stock options with graded vesting
  • Understand how to account for deferred taxes and track APIC pools
  • Become familiar with recent issues including repricings and modifications
  • Learn how ASC 718 differs from IFRS 2

Who Should Attend

Industry controllers, accountants, and finance and human resource professionals looking to solidify their knowledge of the accounting requirements of ASC 718.

Topics

  • Introduction to stock based compensation
    • Equity versus liability awards
    • Setting the grant date
    • Types of equity awards (e.g., restricted stock and stock options)
  • Measurement of Fair Value
    • Lattice versus Black-Scholes
    • Obtaining the inputs to the models
    • SAB 107 guidance on expected volatility and expected term
    • Historical versus implied volatility
    • Taking into account current uncertainty in stock prices
  • Recognition of Compensation Costs
    • Explicit and implicit service periods
    • Service, Performance and Market Conditions
    • Cliff vesting versus graded vesting
  • Modification of Awards
    • Repricings
    • Settlements
    • Repurchases
    • Cancellations
    • Modifications of vesting conditions, performance and service conditions
  • Tax Issues
    • Non-qualified Stock Options
    • Incentive Stock Options
    • APIC Pools
  • Special Issues
    • Stock Option NOLs
    • Business Combinations
    • Employee Stock Purchase Plans
  • Disclosures
    • Cash flow statements
    • Income statements
    • Footnotes
  • Earnings per Share
  • Comparison with IFRS 2

Teaching Method

  • Group live instruction, examples, group work and open discussions
  • Detailed coverage of ASC 718, with real world examples to illustrate accounting for different types of share based instruments
  • Presentation and discussion of financial statement disclosures
  • Review of real-world financial statements illustrating presentation and disclosures
  • Interactive participation is encouraged
  • All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials

Instructors

The instructor for this course will be drawn from one of our core faculty of subject matter experts. Further details will be published at the earliest opportunity.

Venue

Our seminars take place in 4 star professional conference facilities, generally in city-centre hotels like the Marriott, Sheraton or Hilton brands. Detailed Joining Instructions are sent to all registered delegates by email approximately one month before the event. The Joining Instructions will confirm exact venue details and nearby (or onsite) hotel recommendations with bedroom rates where available. Coffee and lunch will be provided.

CPE/CPD Accreditation

IASeminars is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org .

 

Field of study: Accounting

Prerequisites

Basic understanding of accounting principles. No advance preparation is required for this course.

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