Page 778 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

Appendix F. Selected Accounting Interpretations 763

• EITF 00-8, “Accounting by a Grantee for an Equity Treatment to Be Received in
Conjunction with Providing Goods or Services.” The fair value is on the earlier of (a) the
date of commitment or (b) the date of completion of goods or services.
• EITF 00-12, “Accounting by an Investor for Stock-Based Compensation Granted by
an Investor to Employees of an Equity Method Investee.” Describes how the parent
company and subsidiary company account for stock compensation.
• EITF 00-15, “Classification in the Statement of Cash Flow of the Income Tax Benefit
Received by a Company upon Exercise of a Nonqualified Employee Stock Option.”
Describes the treatment of stock option income tax benefits in cash flow statements.
• EITF 00-16, “Recognition and Measurement of Employer Payroll Taxes on Employee
Stock Based Compensation.” Describes when a compensation cost and liability should be
recognized by the company.
• EITF 00-18, “Accounting Recognition for Certain Transactions Involving Equity
Instruments Granted to Other Than Employees.” Describes non-employee equity
accounting considerations.
• EITF 00-23, “Issues Relating to the Accounting for Stock Compensation under APB 25
and FASB Interpretation No. 44.” Addresses over 70 rather technical issues.
• EITF 01-9, “Accounting for Derivative Financial Instruments Indexed to, and Potentially
Settled in, a Company’s Own Stock.” Numerous criteria are provided, but contract cannot
provide holder greater rights than a common stockholder.
• EITF 02-8, “Accounting for Options Granted to Employees in Unrestricted, Publicly
Traded Shares of an Unrelated Entity.” The award should be treated as a derivative for
accounting in accord with FASB Statement No. 133, “Accounting for Derivative Instruments
and Hedging Activities.”
Sources: Accounting Principles Board and Financial Accounting Standards Board