Heads Up — FASB proposes a practical expedient for determining the share price input for measuring equity-classified share-option awards for private companies

Published on: 18 Aug 2020

This Heads Up discusses the FASB’s recently issued proposed Accounting Standards Update (ASU) Determining the Current Price of an Underlying Share for Equity-Classified Share-Option Awards. The proposed ASU would allow private companies to use a practical expedient to determine the current market price of the underlying share of equity-classified share-option awards issued to grantees. Under the practical expedient, private companies would make this determination by using a valuation that such companies have performed to comply with the “presumption of reasonableness” requirements in Section 409A of the U.S. Internal Revenue Code.


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