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Market based conditions have already been factored into the fair value of the equity instrument at the grant date therefore an expense is recognised irrespective if weather market conditons are satisfied or not what does this mean please can you explain?
How is it factored in?Calculation of FV of option uses a model known as Black Scholes. One of the inputs to the model is share price volatility (Betas and all that). If you study AFM I think you meet the detail there. In CR we just have to accept the rule.
Hope this helps.:)
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