Ford has announced that it will expense stock options granted to employees in a move seen as part of the current trend towards improving clarity in financial reporting.
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During 2001, the cost of expensed stock options was $150 million, or 8 cents a share. For 2002, the cost isn’t known. Ford employees currently hold options to purchase more than 172 million shares of Ford common stock.
“Expensing stock options will not represent a significant cost to us,” said Allan Gilmour, vice chairman and chief financial officer. “We have adopted this accounting change in an effort to further enhance the clarity of our financial statements.”
Ford said it will expense the fair-market value of options granted to employees under guidelines of the Financial Accounting Standards Board (FASB) rule, SFAS No. 123.
