ICAI PROPOSES `FAIR VALUE' FOR ESOPS (ICAI suggests that companies adopt fair value method for expensing ESOP, stock appreciation rights and shares offered under ESPP).

(From India Business Insight)

The Institute of Chartered Accountants of India (ICAI) is of the opinion that companies should adopt a `fair value method' for expensing employee stock options (ESOP), stock appreciation rights and shares offered under the employee stock purchase plan (ESPP). The ICAI has come out with guidelines in this regard, which will be effective from 1 Apr 2005. The guidance note will allow use of intrinsic value method, provided the company makes extensive fair value disclosures.

The …