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Sign up to view the full version. This preview shows document pages 1 - 2. Sign up to view the full document. GAAP requires using intrinsic value accounting for employee stock options.
Stock option plans 2. If previous experience indicates that a material number of stock options will be forfeited before they vest, the fair value estimate of the options on the grant date should be adjusted to reflect that expectation.
Stock option plans 3. Compensation expense must be adjusted during the service period to reflect changes in the fair value of options caused by changes in the market price of the underlying shares.
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