SFAS No. 123R: the controversy and its economic consequences

Richard Schroeder (University of North Carolina at Charlotte, Charlotte, North Carolina, USA)
David A. Schauer (Department of Economics and Finance, College of Business Administration, University of Texas at El Paso, El Paso, Texas, USA)

Managerial Auditing Journal

ISSN: 0268-6902

Publication date: 21 March 2008



To review the evolution of SFAS No. 123R, “Accounting for Share Based Compensation,” and examine the economic consequences of the standard for the first group of filers impacted by its provisions.


The sample was the population of firms in the Russell 3000 having June 30, fiscal year‐ends.


The study's findings suggest that the provisions of SFAS No. 123R remain controversial and that compliance with the standard had significant economic consequences for the sample of companies.


This study provides evidence that SFAS No. 123R had significant economic consequences but that some of the standard's effects differed from earlier predictions.



Schroeder, R. and Schauer, D. (2008), "SFAS No. 123R: the controversy and its economic consequences", Managerial Auditing Journal, Vol. 23 No. 3, pp. 295-306. https://doi.org/10.1108/02686900810857730

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