Share Based Payments (ASC 718 - FAS 123R)

Aranca has performed hundreds of stock options valuations for ASC 718 (formerly, FAS 123R) for growing privately held companies across diverse industry sectors and enterprise development stages. We have extensive experience in dealing with firms ranging from early start-ups to exit /IPO stage and their complex capital structures.

ASC 718 as well as IFRS 2 “Share-Based Payments” requires all share-based compensation and other payments involving grant of equity securities or derivatives be accounted at ‘fair value’ and expensed off over their vesting period. Compliance with these provisions requires use of sophisticated option pricing models and tracking behavioral data related of option recipients. The entire exercise can become quite complex with increasing number of grants, frequency of grants and difference in vesting terms, posing a significant administration and compliance challenge for the accounting and finance staff.

As a leading provider of financial reporting valuation services, Aranca can help you manage this quite efficiently and cost effectively. Our valuations are thoroughly documented and modeled in a customized fashion considering all client-specific parameters which can affect fair value of the instruments. Through practical application of complex options pricing models, we help clients deal with all facets arising from ASC 718 provision for stock options expensing.

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