Research On Accounting Measurement Of Executive Stock Options

Modern enterprises system features the seperation of enterprise ownership and its management.In modern erterprise system,shareholders consign the management to executives,then executives function as the agents of sharehoders in contract arrangement.As the target function of executives is different with shareholders',executives may maximize their own benefits at the expense of shareholders'.As the incentive scheme to solve Client-Agent problems between shareholders and executives,executive stock option(ESO) is a contradiction since its emergence:ESO can solve Client-Agent problems to a certain extent,but itself is also becoming part of Client-Agent problems.A series of finance scandal broken out in the recent yuears in America make people know that the improper accounting treatment for ESO leave the very big space to manager carry on accountancy forging. In addition,the improper accounting treatment for ESO drives shareholders,board members and executives to falsely perceive stock options to be inexpensive,then causes serious distortion on the frame and format of the incentive contract.Thus,the research on the accounting treatment for ESO can be helpful to control earnings manipulation,mitigate the agent costs,improve the information quality of the financial reports,and maximize shareholder benefits.For ESO started lately in China and the related accounting principles are not perfect,the paper have its meaning in practice.The acconting treatment for ESO mainly includes the recognition,measurement and report of stock option.This paper throws light on the measurement of ESO: Directed by the modern theory, using standard method and case study method,combined with existed achievements about theoretical researches and practice activities of ESO accounting in the world, this paper researches the measurement of ESO,and follows the new development trend in the whole world,in order to make suggestions to perfect ESO accounting principles of China.There are five chapters altogether. Chapter One introduces the subject selection,research scope and mathod and innovation and deficiency of this paper.Chapter Two analyses the Client-Agent theory,then points out the economic essential and business behave of ESO.As the main bodies of this paper,Chapter Three and Four analyse the measurement object of ESO basing on the economic essential and business behave of ESO,then discuss the measurement attribute,measurement methods and Measurement Date of ESO,whose interrelationship is also studied in these chapters.Chapter Five is the conclusion of this paper.It also points out the research meaning both in accounting theory and practice.The appendix is a case study on a Chinese listed company.Combining the accounting theory and practice,throungh this case,the paper points out something which need to be improved on in share-based payment accounting.