Stock-based compensation - 5 things to know about modifications

PwC's accounting podcast

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We kick off our miniseries on stock-based compensation with a focus on 5 important things to know when accounting for modifications to stock-based compensation awards.
In this episode, we discuss:

• 2:40 – How to determine whether a change in terms or conditions should be accounted for as a modification
• 5:00 – The stock-based compensation modification framework
• 8:29 – Four types of modifications related to vesting conditions
• 18:39 – Modifications that change classification
• 22:15 – Modifications of performance conditions

For more information, see chapter 4 of our Stock-based compensation guide. Additionally, follow this podcast on your favorite podcast app for more episodes.
Ken Stoler is a partner in PwC’s National Office who specializes in financial reporting and plan design issues related to equity compensation arrangements, retirement and healthcare plans, and other benefits. He has helped companies navigate their employee compensation issues during IPOs, spin offs, acquisitions, and other major transactions or events.
Heather Horn is the PwC National Office Sustainability & Thought Leader, responsible for developing our communications strategy and conveying firm positions on accounting, financial reporting, and sustainability matters. In addition, she is part of PwC’s global sustainability leadership team, developing interpretive guidance and consulting with companies as they transition from voluntary to mandatory sustainability reporting. She is also the engaging host of PwC’s quarterly webcast series.
Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [e-mail].

Chapter

1. Stock-based compensation - 5 things to know about modifications (00:00:00)

2. How to determine whether a change in terms or conditions should be accounted for as a modification (00:02:40)

3. The stock-based compensation modification framework (00:05:00)

4. Four types of modifications related to vesting conditions (00:08:29)

5. Modifications that change classification (00:18:39)

6. Modifications of performance conditions (00:22:15)