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Accounting for Imputed Stock Grants

My company issues imputed stock grants to our employees twice a year. These stock shares are given to our employees at FMV. Our payroll service takes additional withholding out of the employee's paycheck to cover the taxes on the FMV of the stock grants. Would proper accounting for this be to debit payroll expense subaccount called employee stock grants the value of the sotck and then credit  our companies equity account .

For example an employee is issued 100 shares of stock valued at $10 eachThe accounting entry would be:

Payroll Expense-Stock Grants      $1000

Owner's Equity                              $1,000


(Agent, JKS Solutions, Inc.) |

Without reviewing your policy and plan there is no telling if my research results would match your disclosure and accounting process needs. But here are some resources. You should look to find the recommended journal entries that are located with each type of plan within the published accounting standards at If you do not have a subscription or your CPA cannot provide the most recent standards for you, then you should get a copy of Wiley GAAP.

Here are the guidance links at the AICPA Interest Areas that talk about all the resources

Here is a link to Grant Thornton analysis (you can google share based payments)

Share Based Payment Guidance is what you are looking for:

FAS 123R is the pre-codification accounting standard that I believe you might need to review. Any FASB updates are not included after the issue date. (click 'accept' to gain access to the original text) Look for the suggested journal entries

Grant Thornton provides a PDF on the updates since the original pronouncement.

I authored a 30 page process manual for a company on this topic. The reconciliations can be complex, dealing with variations on transaction choices are complex, statement of equity and cash flow statement disclosures can be complex.

I can't answer your specific question, but these are many tools that should lead you in the right direction.

Best advice - call your CPA that does the financial statement work and they will help you decide.


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