The US House of Representatives on Tuesday voted 312-111 to support a bill designed to override a proposal put forward by the Financial Accounting Standards Board (FASB), which would require firms to record as an expense stock options afforded to employees.
Critics of the proposal put forward by the Board, which establishes US accounting rules, argued that an obligation to count share options against their bottom line would have an adverse impact on a great many US businesses, and could potentially discourage new startups and stifle innovation.
Under the legislation passed by the House, expensing of stock options would be limited to those held by a firm's five top executives, with newly listed corporations exempt from this requirement for the first three years of their existence as a public company.
According to reports, similar legislation is currently stalled in the Senate.
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