13
4/14/2003
Stock Option Grant Expense
•Stock
options are compensation, just like wages, salaries and benefits.
Therefore:
–Expenses
related to stock option grants should be treated like other compensation
costs in calculating earnings.
–Expenses
should be reported quarterly rather than annually.
•Employee
stock option grant expense is included in Standard & Poor’s
Core Earnings.
•Standard
& Poor’s takes no position on the tax treatment of stock
option grants.