ACC 201 -- Week5 Stock Options

ACC 201 -- Week5 Stock Options - Stock Options 1 An Issue...

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Stock Options 1 An Issue at Hand in the Financial World Ashley Dyal ACC 201 Ms. Rayford March 8, 2011
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Stock Options 2 An Issue at Hand in the Financial World There is a major issue that has arisen over the past few years in the financial world. This issue is a crucial one in the profit margins that are made by some. If the issue is not addressed and fixed accordingly the companies that are involved will suffer greatly in the end. This major issue has to do with the stock option offered to the CEOs of many companies and how it is being back dated. Stock options allow the owner of the said stock the option to buy a given amount of stock shares a set price. This set price is approved by the company and is known as the formal grant date. This formal grant date locks in the price, usually the going market price at that point in time, for a short set period of time. This is often where illegal back dating comes into play because the CEOs and CFOs take advantage of a formal grant date by further extending that date to an earlier period of time to reap bigger financial gains. The use of back dating is not actually illegal as long as all guidelines are
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This note was uploaded on 04/18/2011 for the course ACC 201 taught by Professor Alao during the Spring '10 term at Ashford University.

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ACC 201 -- Week5 Stock Options - Stock Options 1 An Issue...

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