Steve Schear on video voyeurism, stock options [priv]

[Declan McCullagh <declan () well com>]

I interviewed Rebecca McEnally, the CFA Institute's vice president of 
advocacy, for an article last week:
http://news.com.com/Tech+firms+lobby+to+keep+stock+options/2100-1030_3-5376201.html

I asked her why it was necessary to force expensing of stock options 
when they're already typically disclosed in footnotes. Therefore it's 
straightforward to calculate how they affect outstanding shares. Her 
reply was only sophisticated investors will do that calculation and 
essentially that financial statements should not require a degree in, 
well, finance to interpret.

-Declan


-------- Original Message --------
Subject: Re: [Politech] Congress takes firm stand against "video 
voyeurism!" [priv]
Date: Fri, 24 Sep 2004 08:23:34 -0700
From: Steve Schear <s.schear () comcast net>
To: Declan McCullagh <declan () well com>
References: <4151098B.7020507 () well com>

At 10:11 PM 9/21/2004, you wrote:
> This was approved Tuesday in the House by voice vote... It's already 
> cleared the Senate so now it goes to the president.
>
> It's heartening to know that our elected representatives are ever-vigilant 
> about new technological threats to society! It's not like we had existing 
> privacy torts that would already have provided remedies against such "voyeurs":
> http://www.privacilla.org/business/privacytorts.html
>
> But acknowledging that existing law likely addresses the problem wouldn't 
> permit congresscritters to circulate self-congratulatory press releases, 
> would it?
>
> > House Judiciary Committee Chairman F. James Sensenbrenner, Jr. (R-Wis,) 
> said, "With the development of smaller cameras and the instantaneous 
> distribution capability of the Internet, the issue of 'video voyeurism' 
> is a huge privacy concern.  Unsuspecting adults, as well as high school 
> students and children have been targeted in school locker rooms, 
> department store dressing rooms, and even in their homes."

Where is the Constitutional basis for this?  It certainly cannot be the
"Commerce Clause".  Laws such as these should be solely a state
matter.  The Supreme Court really must resume bringing Congress to heel for
these federally unwarranted laws.

steve




-------- Original Message --------
Subject: Re: [Politech] Securities analysts urge Senate for expensing 
of stock options
Date: Fri, 24 Sep 2004 10:03:23 -0700
From: Steve Schear <s.schear () comcast net>
To: Declan McCullagh <declan () well com>
References: <41502548.8050707 () well com>

At 05:57 AM 9/21/2004, Thomas A. Bowman, CFA wrote:
>I am writing to ask you to vigorously oppose S. 1890, the so-called 
"Stock
>Option Reform Accounting Act."  Your opposition to this so-called 
"reform"
>is a strong statement in favor of investor protection and shareholder 
rights.
>
>As you are aware, the House of Representatives last month passed (H.R.
>3574) that would intervene in the independent accounting rule-making
>responsibility of the non-partisan Financial Accounting Standards Board
>(FASB), which supports the treatment of employee stock options as an
>expense to the company.
>
>In other words, FASB supports reality over fantasy, and the investor's
>right to know over management's right to hide.

As an employee I've held options.  Some matured with in the money strike
prices, most did not and were abandoned.  But in any case, options cost a
corporation almost nothing to issue or administer.  Only those direct costs
should be expensed.  Their impact on the future value of shares should be
determined by investors in a market only.  The only obligation of public
companies should be full disclosure of option awards.

steve


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