Accounting Treatment and Accounting Valuation of ESOP

Excerpts from the article  – “Employees Stock Ownership Plans or “Employees Stock Options Plans” is the generic term for a basket of instruments and incentive schemes provided to the employees of the company. Over the years, the ESOP has taken various forms. ESOP when spelled as ‘Employees Stock Ownership Plans’, relates to the broad and generic meaning which covers most types of share-based payments made to employees.”

“Share-based payments can take form of Employee Stock Option Plan(ESOP), Employee Stock Purchase Plan(ESPPs) and Stock appreciation right However, ESOP as ‘Employees Stock Options Plans’ is one of the modes of share-based payment A stock option is a right but not an obligation granted to an employee in pursuance of the employee stock option scheme to apply for shares of the company at a pre-determined price.” Read more…..

This Article has been published in CA Club India on January 12, 2018

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