718 Dsivlgcplzip -

: It applies to all share-based payment transactions with both employees and nonemployees .

: This includes standard employees, certain leased employees, and nonemployee directors. 718 dsivlgcplzip

: Recent updates, such as ASU 2021-07 , provide "practical expedients" allowing private companies to use simplified methods to determine the current price of their underlying shares, rather than more complex public-market valuations. : It applies to all share-based payment transactions

: The core requirement is to recognize the cost of services received in exchange for share-based awards based on the fair value of those awards at the grant date. : The core requirement is to recognize the

: The FASB expanded Topic 718 to align the accounting for nonemployee share-based payments more closely with the rules for employee awards.

: Companies must "expense options," meaning they record the value of the equity granted as an expense on their income statement over the period the recipient provides the service (the vesting period). Scope and Applicability

: It generally does not apply to share-based payments used for financing the issuer or those granted as part of a contract with a customer (which falls under Topic 606 ). Recent Updates and Simplifications