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Debt vs. Equity: Accounting for Claims Contingent on Firms' Common Stock Performance with Particular Attention to Employee Compensation Options

James A. Ohlson; Stephen H. Penman

Title:
Debt vs. Equity: Accounting for Claims Contingent on Firms' Common Stock Performance with Particular Attention to Employee Compensation Options
Author(s):
Ohlson, James A.
Penman, Stephen H.
Date:
Type:
Working papers
Department:
Business
Permanent URL:
Part Number:
1
Publisher:
Columbia Business School, Center for Excellence in Accounting and Security Analysis
Publisher Location:
New York
Abstract:
This paper lays out a comprehensive solution to the problem of accounting for claims based the performance of a firm's stock price. The accounting covers employee stock options, stock appreciation rights, put and call options, convertible debt and preferred stock, warrants, and other hybrid securities. This issue has vexed the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) who have approached the problem on a piecemeal basis, leading to inconsistent treatments of claims that in substance are very similar.
Subject(s):
Accounting
Item views:
643
Metadata:
text | xml

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