[Congressional Record (Bound Edition), Volume 151 (2005), Part 3]
[Extensions of Remarks]
[Page 4417]
[From the U.S. Government Publishing Office, www.gpo.gov]




SECURITY AND EXCHANGE COMMISSION HAS DUTY TO DELAY MANDATORY EXPENSING 
                            OF STOCK OPTIONS

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                            HON. ERIC CANTOR

                              of virginia

                    in the house of representatives

                        Thursday, March 10, 2005

  Mr. CANTOR. Mr. Speaker, today we are facing a problem that if gone 
unchecked will have a detrimental effect on business's ability to 
create jobs and opportunity. In June, small and large companies will be 
subject to mandatory expensing of their stock options as required by 
the Financial Accounting Standards Board. If businesses are forced to 
adhere to this untested and risky expensing method, it could hamper our 
growing economy at a time when it is crucial to sustain growth and 
create jobs, not stop it.
  It is important that businesses continue to be able to use this 
valuable tool to attract employees to the market. Expensing of stock 
options will cause a blow to small business's investment and 
innovation. It will harm a market that uses stock options as a tool to 
recruit high quality employees to small firms. These innovators would 
be lost to larger, more established companies.
  Stock options serve as a tool to drive innovation and creativity by 
linking company success to employee success. The Security and Exchange 
Commission has the duty to delay this plan until the valuation methods 
can be improved; I urge them to do so.

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