FASB delays stock option rule.

• Position: National

The proposed new rule to deduct stock options from profits of public companies has been delayed six months. The new valuation method will take effect with financial statements beginning June 15, 2005.

FASB proposed in March that options expensing become mandatory starting next year. Many organizations protested, arguing they were already overwhelmed complying with the wave of other new requirements--mostly related to Sarbanes-Oxley.

Technology firms lobbied the FASB to delay implementation and allow more time for firms to make necessary changes to comply with the new rule. The FASB also agreed to let companies impacted by the rule restate earnings for the first two quarters of 2005 to ease quarter-to-quarter comparisons.

The issue has been a contentious one for members of Congress. The U.S. House passed legislation this summer to limit the expensing of stock options to the top five...