Closing the books each fiscal quarter has never been a simple process. Thanks to ASC718, the compliance hurdles are even greater. Fortunately there are better ways to derive the valuation, expense, disclosure and tax calculations that ensure compliance. This white paper reviews the 5 key steps that you can take to properly account for your equity compensation program.
The primer covers these five areas:
- Determining the valuation, including different valuation methods and parameters such as expected life and volatility rate
- Making your expensing decisions including fixed vs. variable accounting, straight line vs. graded amortization and forfeiture rates
- Calculating your corporate taxes, with discussion on deferred tax assets and the APIC calculation method
- Accounting for dilution, and
- Preparing your disclosures