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This is probably a stupid question and I might be overthinking it. In shared based payments, market conditions are not considered and so expense is still recognised based on fair value of option at grant date regardless of if condition is linked to share price. That I understand and then I get lost when I get to modification. Why are we creating an additional Adjustment if share price of an entity decreases? Example an entity reprises it’s share options because market price has fallen and so fair value has gone from 10-15. We have to add the 5 difference to the original workings. In my head I am seeing this as a market based so regardless of share price falling no adjustment is needed.
Clearly I am wrong but I just need someone to break it down for me.