Regulatory Update By Bruce Overton, The Benefit Company, Atlanta, Georgia

Change in regulations that will affect executive pay and a number of year-end 2003 regulations established by the Financial Accounting Standards Board (FASB), the Internal Revenue Service (IRS), and the Securities and Exchange Commission (SEC), are summarized. The FASB leads in regulatory impact on...

Full description

Saved in:
Bibliographic Details
Published inExecutive Compensation Vol. 30; no. 1; p. 1
Main Author Overton, Bruce
Format Trade Publication Article
LanguageEnglish
Published Englewood Cliffs Aspen Publishers, Inc 01.01.2004
Subjects
Accounting standards
Compensation
Executive compensation
Financial accounting standards
Grants
Incentive plans
Income taxes
Internal Revenue Code
Public companies
Section 421
Securities regulations
Stock options
Stock rights
United States > US
Online AccessGet full text

Cover

More Information
Summary:Change in regulations that will affect executive pay and a number of year-end 2003 regulations established by the Financial Accounting Standards Board (FASB), the Internal Revenue Service (IRS), and the Securities and Exchange Commission (SEC), are summarized. The FASB leads in regulatory impact on executive pay with its intended requirement that companies incur an income statement charge from any and all stock awards. The IRS issued new regulations for Code Section 421 that deal with incentive stock options (ISO). For the most part, these new regulations are clarifications and confirmations of previous interim guidelines and are not expected to result in any substantial change in company practices. In the area of stock-for-stock exercises, the IRS has clarified the fact that a stock-for-stock exercise does not violate the statutory requirements of an ISO, even if the decision on such an exercise is discretionary by the individual. The SEC has, in follow-up to the Sarbanes-Oxley Act, accelerated the reporting of company stock transactions by company insiders in 2002.