Improvements to employee share-based payment accounting
How these updates can impact the life sciences industry
Given the long, uncertain and risky nature of the drug development and approval process maintaining employee motivation can be challenging. As a result, most life sciences companies offer competitive share-based compensation plans in order to attract and retain top talent as a major part of their employee compensation. The goal is to improve employee morale and keep employees invested so that they add to the overall value of the enterprise.
Recently, the FASB issued updates to the share-based compensation standard to simplify the existing rules around recording and reporting employee share-based payments. The changes are expected to simplify the current complex and time intensive accounting requirements for employee share-based payment transactions. These changes can be early adopted or become effective for calendar year public companies beginning the first quarter of 2017 and for private companies beginning in 2018.
To help you gain this understanding, read our article, Improvements to employee share-based payment accounting.