Research Accounting Treatment For Equity Incentive

Equity incentive is effective incentive system inmodern enterprise. In recent years, more and more companies encourage business owners to promote the realization of business value maximizationthrough the implementation of equity incentive plan. From the statistical data from the period 2005-2014, a total of 673 of the 851 listed companies have provided equity incentive plans, including 630 listed companies equity incentive plan in the implementation phase.February 2006, China’s Ministry of Finance Accounting Department issued the "Enterprise Accounting Standards No.11-Share-based Payment", making the accounting treatment of equity incentives more standard. However, our equity incentive practice have carried out not long time, leading to guidelines not involving in all accounting matters.With the continuous development of incentive stock options, the practice of accounting standards for clarity also put forward higher requirements. Especially for IPO enterprises, as well as the lack of relevant laws and regulations imperfect capital market makes a lot of equity incentive of IPO companies do not deal with its accounting, or due to focus on share-based payment expense in the accounting treatment led to huge profits loss.This paper describes the current accounting standards for the accounting recognition and measurement principles of equity incentive matters. Then select the 673 listed companies in the implementation of equity incentive plan period from 2005 to 2014 as a sample, the current equity incentive implementation of China’s listed companies do descriptive statistics and analysis, found that from 2013 the number of restricted stock plan implemented over Number of stock options, companies increasingly tend to explain the rights and obligations of symmetrical restricted stock incentive plan, based on the statistical analysis of the results of the current share-based payment problems in accounting standards, namely the estimated number of vesting, vesting conditions and setting to determine the fair value of equity instruments, the business there is a certain level of subjectivity and arbitrariness in the implementation; the second is to explain the guidelines guide practitioners believe in restricted stock grant date required in the notes to confirm the existence of incentive fees objection; third is using the Erie case to analyze of the accounting treatment of imperfections practitioners exist, including the exercise of the indicator is too low, the exercise index selection unreasonable, irrational caliber net profit accounting issues; Fourth,IPO enterprises should apply Accounting Standards for discussion range or not, combined with the Swiss and decorative case, pointed out IPO shares to determine the fair value of the enterprise and the cost amortization method difficult. In order to fully complete the accounting treatment of equity incentive practitioners to listed companies and listed companies for the study, found that companies with equity incentive problems in accounting practices, and make recommendations..