SEC to Delay Expensing Rules Six Months

The staff of the Securities and Exchange Commission (SEC) has recommended that the SEC commissioners vote to delay by six months the starting date for implementation of requirements that companies must expense options, and the commissioners are expected to soon do so, according to the Wall Street Journal (April 13). The delay applies to public companies and would push back the implementation date from the current requirement that public companies begin expensing for accounting periods beginning after June 15, 2005, to January 1, 2006. An announcement with details on the plan is expected this week. News reports do not indicate whether closely held companies would be given an additional six-month delay as well. These companies already had a later deadline of accounting periods after December 15, 2005. The delay is in response to concerns that the new standards, and additional SEC guidance concerning them, are too complicated to install this quickly.