EU states back expensing of stock options by firms

European Union member states have backed an accounting rule that forces EU firms to treat stock options as an expense, a move that will hit profits, an EU diplomat told Reuters on Monday. "The standard was endorsed. All EU member states voted in favour, apart from Hungary, which abstained due to issues of translation," the EU diplomat said.
The agreement by EU government representatives paves the way for the formal adoption of the bookkeeping rule, known as IFRS 2, in the EU next year.
Stock options - the right to buy or sell shares at a set price at a future date - currently do not count as operating costs and have been hugely popular in sectors such as IT, telecoms and pharmaceuticals, especially in the United States.