Deloitte
Accounting Research Tool
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Chapter 8 — Employee Stock Purchase Plans

8.8 Classification

8.8 Classification

If the employee is entitled to purchase a variable number of shares for a fixed monetary amount, the award would be classified as a share-based liability (in accordance with ASC 718-10-25-7 and ASC 480) and recorded at its fair-value-based measure in each reporting period until settlement (i.e., the purchase date). Upon settlement, the award would be reclassified as equity.