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Hi Mike,
Could you explain in simple English what the following means?
“it has granted options to the employees of Margy and Hulty over its own shares as at 7 December 2014. The awards vest immediately. Joey is not proposing to make a charge to the subsidiaries for these options.”
Thanks
The costs of the options shall be borne by the parent.
The options relate to the parent’s share capital and not the share capital of the subsidiaries.
The employees that are entitled to the options are the employees of the subsidiaries.
The employees immediately become entitled to the options (they don’t have to wait for a vesting period to elapse)
Is that better?
Great!!
It was the ‘awards vest’ which i wasn’t too sure about, but it makes sense now. Thank you.
Also I asked this question to my manager at work who told me that they are normally taxed. Along with employee gifting. Is this something that is examinable? In any P level paper?
There was a question involving tax on employee share schemes some time ago (can’t remember the name)
At the time it was asked I thought to myself that you could count on the fingers of one hand the number of students getting that bit right.
It was a particularly messy 4 marks worth of a question and I believe that if you had written anything down, anything at all, you would have scored 1 mark. And if what you had written was along the right lines, that would have got you the second mark (50%)
Don’t beat yourself up about it – there are plenty of other areas to get excited about without wandering away into the darker parts of the world of P2
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