An Analysis and Comparison of Bankers' Perceptions of Stock Options in 1999 and 2005 (Report‪)‬

ABSTRACT Research to date on accounting for stock options has focused the analysis on a single group of corporate stakeholders, stockholders. This paper reports the results of a survey administered to another group of stakeholders, creditors. Commercial bankers were surveyed regarding the accounting treatment for stock options and the perceived impact of stock options on financial statements, firm valuation, and the loan decision. A unique aspect of our study is that we surveyed bankers during two distinct periods. We first surveyed bankers in 1999, well after the debate surrounding SFAS 123 (FASB, 1995), but before the resurgence of the debate leading up to SFAS 123(R) (FASB, 2004). We surveyed again in 2005, as companies were implementing SFAS 123(R). This allows us to comment on the impact of public debate preceding the rule revision on the perceptions of a group of well-informed financial statement users.