Stock options rule gets CBI support
Plans by the International Accounting Standards Board to force companies to expense stock options are being backed by a leading British think-tank.
Sir Nigel Rudd, chairman of the Confederation of British Industry’s committee on boardroom affairs, said he broadly agreed that the issuing of stock options was a ‘cost to the company’, the FT reported today.
Sir Nigel who is also chairman elect of high-street chemist Boots and a non-executive director of Barclays, said accountants had become ‘pretty sophisticated’, adding ‘I just think disclosure is everything’.
A number of major global brands have already begun expensing stock options including Microsoft, Amazon.com and Coca-Cola.
The IASB is preparing a new set of financial reporting standards, including the deducting of stock options from profits.
Companies in Europe must adopt new accounting standards by 2005.