Executive Stock Option Accounting Issues

Since the first Executive Stock Option(ESO) appeared in American company in 1952, it has been favored by every states and every corporations for its superiorities on corresponding benefits between the owners and the managers, cutting down agent costs, improving enterprise values. The American studies and applies ESO firstly, so we should learn form them, though it still has much disputability on its accounting recognition and measurement. Since Wan Ke introduced ESO into our country, it has never been stopped studied and used. However it just starts and has not formed integrated system by now. This paper is based on theoretic and practices and draws on the research of recognition and measurement of ESO and designs an accounting system about ESO.Chapterl,the current research and components of ESO. This chapter introduces some national experiences about ESO and points out its executive price % vesting period and etc.Chapter2,the theoretical analysis of ESO. This chapter clarifies the relationship between Client-Agent and ESO, and the relationship between human capital theory and ESO.Chapter3,the accounting issues of ESO. This chapter includes five parts. Part1 briefly introduces the APB37 the SFAS123 etc. Part2 discusses the recognition of ESO. Part3 discusses the measurement of ESO.Part4 discusses the accounting process of ESO. Part5 discusses ESO information disclosure.Chapter4,the experience of ESO in china and the conclusion of this paper.