课件IAChap019PPT

,SHARE-BASEDCOMPENSATIONANDEARNINGSPERSHARE,Chapter19,2013TheMcGraw-HillCompanies,Inc.,Share-BasedCompensation,Compensation:SalaryShareawards,ShareAwardPlans,RestrictedshareplansUsuallytiedtocontinuingemployment,Compensationismarketpriceatdateofgrant,Compensationexpenseaccruedoverserviceperiod.,ShareOptionPlans,Shareoptionplansgiveemployeestheoptiontobuyaspecifiednumberofsharesofthefirmsshare,ataspecifiedexerciseprice,duringaspecifiedperiodoftime.Thefairvalueisaccruedascompensationexpenseovertheserviceperiodforwhichparticipantsreceivetheoptions,usuallyfromthedateofgranttowhentheoptionsbecomeexercisable(thevestingdate).,ExpenseTheGreatDebate,Historically,optionshavebeenmeasuredattheirintrinsicvaluethesimpledifferencebetweenthemarketpriceofthesharesandtheoptionpriceatwhichtheycanbeacquired.Ifthemarketandexercisepriceareequalonthedateofgrant,nocompensationexpenseisrecognizedeveniftheoptionsprovideexecutiveswithsubstantialincome.,CurrentRequirements,ThingschangedinNovember2002whentheIASBissueditsexposuredraftED2onShare-basedPayment.(ThiswasfollowedbythestandardIFRSNo.2inFebruary2004.)ThereleaseofED2cameintheaftermathoftheaccountingscandalsandthe“dot-com”crisis,andtheshell-shockedmarketweremorewillingtoacceptahigherlevelofdisciplinewithregardstodisclosuresonmanagementcompensation.ThustherequirementforcompaniestomeasureoptionsattheirfairvaluesatthetimetheyaregrantedandtoexpensethatamountovertheappropriateserviceperiodbecamerequiredunderbothIFRSandU.S.GAAP,MeasurementObjectives,RecognizingFairValueofOptions,Accountingforshareoptionsparallelstheaccountingforrestrictedsharewediscussedearlier.Wenowarerequiredtoestimatethefairvalueofshareoptiononthegrantdate.,IFRS(andU.S.GAAP)requiresthatcompensationexpensebemeasuredusingoneofseveraloptionpricingmodelsthatdealwith:1.Exercisepriceoftheoption.2.Expectedtermoftheoption.3.Currentmarketpriceoftheshare.4.Expecteddividends.5.Expectedrisk-freerateofreturn.6.Expectedvolatilityoftheshare.,PlanswithPerformanceorMarketConditions,Ifcompensationfromashareoptiondependsonmeetingaperformancetarget,thenwhetherwerecordcompensationdepends.Initiallyonthebestavailableestimateoftheexpectednumberofoptionsthatwillvest(i.e.basedonthecompanysassessmentofthelikelihoodoftheperformancetargetbeingmet)andUltimatelyonwhethertheperformancetargetactuallyismet.Ifthetargetisbasedonchangesinthemarketratherthanonperformance,werecordcompensationasiftherewerenotarget.,U.S.GAAPvs.IFRS,Adeferredtaxasset(DTA)iscreatedforthecumulativeamountofthefairvalueoftheoptionsthecompanyhasrecordedforcompensationexpense.Accountforeachvestingamountseparatelyoraccountfortheentireawardonthestraight-linebasisovertheentirevestingperiod.,Therearemoresimilaritiesthandifferencesinthetreatmentofshareoptions.Onemajordifferenceisthetreatmentofdeferredtaxassetsandwhenoptionshavegraded-vesting.,Thedeferredtaxassetisnotcreateduntiltheawardis“inthemoney;”thatisithasintrinsicvalue.Straight-linechoiceisnotpermitted.Companiesnotrequiredtorecognizetheawardthathasvestedbyeachreportingdate.,PlansWithGraded-Vesting,Ratherthanshareoptionplansvestingonasingledate,moreplansawardsspecifythatrecipientsgraduallybecomeeligibletoexercisetheiroptionsratherthanallatonce.Thisiscalled“gradedvesting.”,Thecompanyshouldvieweachvestinggroupseparately,asifitwereaseparateaward.Forexample,acompanymayawardshareoptionsthatvest25%inthefirstyear,25%insecondyear,and50%thethirdyears.Foraccountingpurposeswehavethreeseparateawards.,Thestraight-linemethodisnotallowed,Employeeshareoptionplans,Permitemployeestobuysharesdirectlyfromtheiremployer.Usuallytheplanisconsideredcompensatory,andcompensationexpenseisrecorded.Aslongas.AcompanygrantsallholdersofaparticularclasstherighttobuyequityinstrumentsatadiscountandAnemployeehappenstobeaninvestorinthatparticularclassandtransactswiththecompanyasaninvestorTheoptionplanitissimplyrecordasasaleofnewsharestoemployees:,Employeeshareoptionplans,However,Ifthediscountedsaleismeanttobenefitonlyemployeesandisnotextendedtoallinvestorsinaparticularclass,accountingissimilartoothershare-basedplans.Thediscounttoemployees,then,isconsideredtobecompensation,andthatamountisrecordedasexpense.Thecompanymeasuresthedifferencebetweenthefairvalueofsharesissuedandthecashreceivedasthecompensationexpense,Cash(100$8.50)850Compensationexpense(100$1.50)150Ordinaryshares(100$10.00)1,000,Marketvalue,EarningsPerShare(EPS),Ofthemyriadfactsandfiguresgeneratedbyaccountants,thesingleaccountingnumberthatisreportedmostfrequentlyinthemediaandreceivesbyfarthemostattentionbyinvestorsandcreditorsisearningspershare.,SimpleCapitalStructure(BasicEPS),BasicEarningsPerShare,Netincome(aftertax)preferencedividends*Weightedaverageoutstandingordinaryshare,*Currentperiodscumulativepreferencebonusissues(whetherornotdeclared)andnoncumulativepreferencebonusissues(onlyifdeclared).,IssuanceofNewShares,Computetheweightedaveragenumberofsharesofordinaryshareoutstanding.,IssuanceofNewShares,Computetheweightedaveragenumberofsharesofordinaryshareoutstanding.,100,000+50,000(9/12)+10,000(3/12)=140,000,SharesatJan.1,NewShares,NewShares,AnnualWeighting,AnnualWeighting,BonusIssuesandShareSplits,Ordinarysharesissuedaspartofbonusissues(alsoknownasshareorstockdividends)andsharesplitsaretreatedretroactivelyassubdivisionsofthesharesalreadyoutstandingatthedateofthesplitordividend.,BonusIssuesandShareSplits,Computetheweightedaveragenumberofsharesofordinaryshareoutstanding.,BonusIssuesandShareSplits,Computetheweighted-averagenumberofsharesofordinaryshareoutstanding.,100,000(2.00)+50,000(9/12)2.00=275,000,SharesatJan.1,NewShares,bonusissueadjustment,AnnualWeighting,BonusIssuesandShareSplits,Retroactivetreatment:,Bonusissueorsplitistreatedasoutstandingfromthebeginningoftheperiod.,Bonusissueorsplitisappliedretroactivelyinproportiontothenumberofsharesoutstandingatthetimeofthedividendorsplit.,Newsharesissuedthisperiod?,Yes,No,ShareBuy-Back,Ifshareswerereacquiredduringtheperiod,theweighted-averagenumberofsharesisreduced.Thenumberofreacquiredsharesistime-weightedforthefractionoftheyeartheywerenotoutstanding.,ShareBuy-Back,Computetheweighted-averagenumberofsharesofordinaryshareoutstanding.,ShareBuy-Back,Computetheweighted-averagenumberofsharesofordinaryshareoutstanding.,100,000+50,000(9/12)-12,000(8/12)=129,500,SharesatJan.1,NewShares,TreasuryShares,AnnualWeighting,AnnualWeighting,EarningsAvailabletoOrdinaryShareholders,*Ormoreseniorclassesofshareholders,ComplexCapitalStructure(DualEPS),Dilution/AntidilutionTest,ShareOptions,Convertiblesecurities,Treasurysharemethod,If-convertedmethod,Contingentlyissuableshares,PotentialOrdinaryShares:ShareoptionsandwarrantsConvertiblebondsandshareContingentordinaryshareissues,DilutedEarningsPerShare,MayReportBasicandDilutedEarningsPerShare,Options,Rights,andWarrants,Proceeds,Usedto,Purchasetreasuryshares,Ataveragemarketprice,Thetreasurysharemethodassumesthatproceedsfromtheexerciseofoptionsareusedtopurchasetreasuryshares.Thismethodusuallyresultsinanetincreaseinsharesincludedinthedenominatorofthecalculationofdilutedearningspershare.,Options,Rights,andWarrants,Determinenewsharesfromassumedexerciseofshareoptions.Computenumberofsharesrepurchased.,Options,Rights,andWarrants,Determinenewsharesfromassumedexerciseofshareoptions.Computesharespurchasedforthetreasury.Computetheincrementalsharesassumedoutstanding.,Newsharesfromassumedexercise(1)Less:Treasurysharesassumedpurchased(2)Netincreaseinsharesoutstanding(3),OptionsandWarrants,Whentheexercisepriceexceedsthemarketprice,thesecuritiesareantidilutiveandareexcludedfromthecalculationofdilutedEPS.,Anti-DilutiveSecurities,WhenallthedilutivesecuritiesareincludedinthecalculationofdilutedEPS,atthesametime,wemaynotarriveatadilutedEPSthatisthelowestpossiblefigureorthe“worstcase”EPS.,Anti-DilutiveSecurities,In-the-money”optionorwarrantisthemostdilutivesecurityamongpotentialordinaryshares.,ConvertibleSecurities,Theif-convertedmethodisusedforconvertibledebtandequitysecurities.Themethodassumesconversionoccursasofthebeginningoftheperiodordateofissuance,iflater.,ConvertibleSecurities,Theassumedconversionofconvertiblebondsorpreferenceshareshastwoeffectsondilutiveearningspershare:increasesthedenominatorbythenumberofordinarysharesissuableuponconversion,increasesthenumeratorbydecreasingafter-taxinterestexpenseonconvertiblebonds,anddividendsonconvertiblepreferenceshares.,Anti-DilutiveSecurities,Forconvertiblesecurities(convertiblebondsandconvertiblepreferenceshares),wedeterminewhetherconvertiblesecuritiesaredilutivebycomparingthe“incrementaleffect”onEPSfromtheassumedconversion.,AdditionalEPSIssues,Contingentsharesareissuableinthefutureforlittleornocashconsiderationuponthesatisfactionofcertainconditions.ContingentlyissuablesharesareconsideredtobeoutstandinginthecomputationofEPSifthetargetperformancelevelalreadyisbeingmet.,ContingentlyIssuableShares,ContingentlyIssuableShares,Sharesareissuedmerelyduetopassageoftime.,Sometargetperformancelevelhasalreadybeenmetandisexpectedtocontinuetotheendofthecontingencyperiod.,ContingentsharesareincludedindilutiveEPSif:,Example:Additionalsharesmaybeissuedbasedonfutureearnings.,RestrictedShares,Restrictedsharesarequicklyreplacingshareoptionsastheshare-basedcompensationplanofchoice.Likeshareoptions,thetreasurystockmethodisusedtocalculatethenumberofsharesinthedenominatoroftheEPSequation.Unlikeshareoptions,employeesdonotpaytoacquiretheirshares.,NoadjustmenttothenumeratorDenominatorisincreasedusingtreasurymethod,Summary,Summary,FinancialStatementPresentation,ReportEPSdataseparatelyfor:IncomefromContinuingOperationsDiscontinuedOperationsNetIncome,Appendix19AOption-PricingTheory,Intrinsicvalueisthebenefittheholderofanoptionwouldrealizebyexercisingtheoptionratherthanbuyingtheunderlyingsharedirectly.Anoptionthatpermitsanemployeetobuy$25sharefor$10,hasanintrinsicvalueof$15.,Optionshaveatimevaluebecausetheholderofanoptiondoesnothavetopaytheexercisepriceuntiltheoptionisexercised.,Summary,Thefairvalueof