The date on which to measure the compensation element in a compensatory stock option plan (CSOP) is normally the date on which the employee
A) is granted the option.
B) has fulfilled all the conditions required to exercise the option.
C) may first exercise the option.
D) actually exercises the option.

Question

Quizplus · Accepted Answer

The compensation element in a compensatory stock option plan (CSOP) is typically the difference between the market price of the stock on the grant date and the exercise price of the option. Therefore, the date on which to measure the compensation element is the grant date, which is when the employee receives the option.

The Date on Which to Measure the Compensation Element in a Compensatory