Accounting Treatment And Financial Impact Of Restricted Stock

As early as the early 1990 s,China has introduced the equity incentive system,but the development is relatively slow.With the rapid development of modern enterprises,professionals with science and technology and management technology have become more and more irreplaceable human capital.In the new economic era,the talents who master technological innovation ability and business management ability are playing an increasingly important role in corporate governance.In the recent 30 years of development,equity incentive has been adopted by more and more enterprises.The equity incentive mode in China has also experienced the process of tilting from stock options to restricted stock.Restricted stock has become the preferred mode of equity incentive for enterprises due to its advantages.With the extensive application of equity incentive,it is more and more important to establish a scientific,comprehensive and longterm effective equity incentive mechanism under the modern economic background.In order to study the accounting treatment and financial impact of restricted stock,this paper took the restricted stock incentive case of Lifan as the research object,read and sorted out the research results of domestic and foreign academia and combined with relevant theories and accounting standards.Firstly,this paper analyzes the equity incentive plan of Lifan,such as incentive object,unlocking condition,stock source,grant price,etc.Secondly,the paper studies the accounting treatment of Lifan shares in different periods,such as grant date,waiting period and unlocking period,and analyzes the problems existing in the accounting treatment process based on its treatment methods.Although there are problems,but its essence is the accounting standards and related laws and regulations are not perfect,should not affect the incentive effect.Then,this paper verifies the financial impact of restricted stock of Lifan from the four aspects of profitability,operation ability,solvency and development ability,and finds that the incentive effect is not obvious,which is different from the accounting analysis.Further analysis finds that the reason for the realization of incentive purpose lies more in the program design.At last,this paper gives some Suggestions on the problems of equity incentive in China.