Executive Stock Option Accounting Issues

All the while, Executive Stock Options is considered by experts of corporate governance as the effective incentive scheme to solve principal-agent problems. This incentive mechanism harmonizes the contradiction between managers and shareholders through sharing residual claim, and impels both to seek the identical benefit, then promotes the managers to create the outstanding performance, to meet the objective of maximizing the shareholders' value. Recently, many enterprises of China has developed stock option incentive mechanism and put them to practice. In order to protect some shareholders' benefit in some enterprise, the government push the related documents:Enterprise Accounting Standerd No. 11-Stock Paying after reseaching its basic characteristic, related system environment and also the accounting principle.After reading the new standerd,I think there are some aspects that should be improved in recognition,mearment ,explosure and so on .So I write the paper to talk my opinions on them.Directed by the modern accounting theory, combined with existed achievements about theoretical researches and practice activities of stock option accounting in the world, this paper begins with the processes of recognizing, measuring and disclosing, follows the new development trend in the whole world, in order to find out the most suitable accounting process of China. There are five chapters altogether. Chapter One mainly introduces the basic theory of Executive Stock Options. Chapter Two, Chapter three and Chapter four are the main body of this paper, and they discuss the cognition, measurement and disclosure of accounting for stock option respectively, which are based on the new development in the world. Based on the situation of our country, Chapter five construes the actuality of accounting in China, and points out some useful suggestions.The author tries to make innovative work in the following aspects: 1. Researching more about intrinsic quality of ESO, the author think we should have another owers-equity item -contingent equity2.The author give different opinions on ESO's initial recognition and initial mearment. 3.According to the analysis, the author tries to find out the suitable accounting process method of our country and points out some feasible suggestions.