{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/718/10/#35-subsequent-measurement","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"718","topic_title":"Compensation—Stock Compensation","subtopic":"718-10","subtopic_title":"Overall","section":{"number":"35","label":"35 Subsequent Measurement","anchor":"35-subsequent-measurement","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"718-10-35-1","para":"35-1","html":"
This Subtopic is interrelated with Subtopics 718-20 and 718-30. Material that equally applies to both liabilities and equity is generally found in this Subtopic. However, material may have been placed in one of the other Subtopics.
","snippet":"This Subtopic is interrelated with Subtopics 718-20 and 718-30. Material that equally applies to both liabilities and equity is generally found in this Subtopic. However, material may have been placed in one of the other…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:809e27f6bcb5f4ddbd1855d535b428b7dfd86552a235350223a606cf30dcee30","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7129d65a5b43141fec785978d59066992f53e6b0b102431cbbc781da974a101b","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"block":null,"heading":"Recognition of Nonemployee Compensation Costs","paragraphs":[{"citation":"718-10-35-1A","para":"35-1A","html":"
A grantor shall recognize the goods acquired or services received in a share-based payment transaction with nonemployees when it obtains the goods or as services are received. A grantor may need to recognize an asset before it actually receives goods or services if it first exchanges a share-based payment for an enforceable right to receive those goods or services. Nevertheless, the goods or services themselves are not recognized before they are received.
","snippet":"A grantor shall recognize the goods acquired or services received in a share-based payment transaction with nonemployees when it obtains the goods or as services are received. A grantor may need to recognize an asset bef…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fe388213d2c583c01f639e804b7ec094d235c3a4329e0cadb735b3037e0c5347","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-1B","para":"35-1B","html":"
If fully vested, nonforfeitable equity instruments are granted at the date the grantor and nonemployee enter into an agreement for goods or services (no specific performance is required by the nonemployee to retain those equity instruments), then, because of the elimination of any obligation on the part of the nonemployee to earn the equity instruments, a grantor shall recognize the equity instruments when they are granted (in most cases, when the agreement is entered into). Whether the corresponding cost is an immediate expense or a prepaid asset (or whether the debit should be characterized as contra-equity under the requirements of paragraph 718-10-45-3) depends on the specific facts and circumstances.
","snippet":"If fully vested, nonforfeitable equity instruments are granted at the date the grantor and nonemployee enter into an agreement for goods or services (no specific performance is required by the nonemployee to retain those…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:82525509d943fed84edbf1f066a278580cc578564b8b4dc72ad2ec478a966ba0","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-1C","para":"35-1C","html":"
An entity may grant fully vested, nonforfeitable equity instruments that are exercisable by the nonemployee only after a specified period of time if the terms of the agreement provide for earlier exercisability if the nonemployee achieves specified performance conditions. Any measured cost of the transaction shall be recognized in the same period(s) and in the same manner as if the entity had paid cash for the goods or services instead of paying with, or using, the share-based payment awards.
","snippet":"An entity may grant fully vested, nonforfeitable equity instruments that are exercisable by the nonemployee only after a specified period of time if the terms of the agreement provide for earlier exercisability if the no…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:64cd3917c44ab67e36dc347b15c67cd56d9772423abdc736a03e5de6223cae1b","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-1D","para":"35-1D","html":"
The total amount of compensation cost recognized for share-based payment awards to nonemployees shall be based on the number of instruments for which a good has been delivered or a service has been rendered. To determine the amount of compensation cost to be recognized in each period, an entity shall make an entity-wide accounting policy election for all nonemployee share-based payment awards, including share-based payment awards granted to customers, to do either of the following:
  1. a
    Estimate the number of forfeitures expected to occur. The entity shall base initial accruals of compensation cost on the estimated number of nonemployee share-based payment awards for which a good is expected to be delivered or a service is expected to be rendered. The entity shall revise that estimate if subsequent information indicates that the actual number of instruments is likely to differ from previous estimates. The cumulative effect on current and prior periods of a change in the estimates shall be recognized in compensation cost in the period of the change.
  2. b
    Recognize the effect of forfeitures in compensation cost when they occur. Previously recognized compensation cost for a nonemployee share-based payment award shall be reversed in the period that the award is forfeited.
Transition date:(P) December 16, 2026; (N) December 16, 2026Transition guidance:
606-10-65-2The total amount of compensation cost recognized for share-based payment awards to nonemployees shall be based on the number of instruments for which a good has been delivered or a service has been rendered. To determine the amount of compensation cost to be recognized in each period, an entity shall make an entity-wide accounting policy election for nonemployee share-based payment awards, including share-based payment awards granted to customers in exchange for a distinct good or service, to do either of the following:
  1. a
    Estimate the number of forfeitures expected to occur. The entity shall base initial accruals of compensation cost on the estimated number of nonemployee share-based payment awards for which a good is expected to be delivered or a service is expected to be rendered. The entity shall revise that estimate if subsequent information indicates that the actual number of instruments is likely to differ from previous estimates. The cumulative effect on current and prior periods of a change in the estimates shall be recognized in compensation cost in the period of the change.
  2. b
    Recognize the effect of forfeitures in compensation cost when they occur. Previously recognized compensation cost for a nonemployee share-based payment award shall be reversed in the period that the award is forfeited.
For share-based consideration payable to a customer that is not in exchange for a distinct good or service (or that is in exchange for a distinct good or service and can result in a reduction of the transaction price in accordance with paragraph 606-10-32-26), a grantor shall estimate the number of forfeitures expected to occur in accordance with paragraph 718-10-35-1D(a). If share-based consideration payable to a customer is a payment for a distinct good or service from the customer and the grantor accounts for any portion of the share-based consideration as a reduction of the transaction price in accordance with paragraph 606-10-32-26, the grantor shall estimate the number of forfeitures expected to occur for the entire award (including the portion that is not accounted for as a reduction of the transaction price).
","snippet":"The total amount of compensation cost recognized for share-based payment awards to nonemployees shall be based on the number of instruments for which a good has been delivered or a service has been rendered. To determine…","pending":true,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1b63cfc31110f88955615847ff1a6f27a91d31573adb3b03a29f5f321da0aaef","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-1E","para":"35-1E","html":"
A recognized asset or expense shall not be reversed if a stock option that the nonemployee has the right to exercise expires unexercised.
","snippet":"A recognized asset or expense shall not be reversed if a stock option that the nonemployee has the right to exercise expires unexercised.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d6d9005fae278ef491379fd301611785779a371db80162a40c18c4af389a1edd","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-1F","para":"35-1F","html":"
A grantor shall recognize either a corresponding increase in equity or a liability, depending on whether the instruments granted satisfy the equity or liability classification criteria established in paragraphs 718-10-25-6 through 25-19A. As the goods or services are disposed of or consumed, the grantor shall recognize the related cost. For example, when inventory is sold, the cost is recognized in the income statement as cost of goods sold, and as services are consumed, the cost usually is recognized in determining net income of that period, for example, as expenses incurred for services. In some circumstances, the cost of services (or goods) may be initially capitalized as part of the cost to acquire or construct another asset, such as inventory, and later recognized in the income statement when that asset is disposed of or consumed.
","snippet":"A grantor shall recognize either a corresponding increase in equity or a liability, depending on whether the instruments granted satisfy the equity or liability classification criteria established in paragraphs 718-10-25…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a2ed6265cd86138e0a2e6378fdefa67a79a2e7a5c294edc4a1537dd83ee7d1d4","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f8ad5bb3952b7bc9f9c7a25380ed78047442d60a82c9f88a42406a61dc5e14e3","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"block":null,"heading":"Recognition of Employee Compensation Costs over the Requisite Service Period","paragraphs":[{"citation":"718-10-35-2","para":"35-2","html":"
The compensation cost for an award of share-based employee compensation classified as equity shall be recognized over the requisite service period, with a corresponding credit to equity (generally, paid-in capital). The requisite service period is the period during which an employee is required to provide service in exchange for an award, which often is the vesting period. The requisite service period is estimated based on an analysis of the terms of the share-based payment award.
","snippet":"The compensation cost for an award of share-based employee compensation classified as equity shall be recognized over the requisite service period, with a corresponding credit to equity (generally, paid-in capital). The …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8d958e93a3b5fa716d9c60d8ad352e3a092e23ea3465580c1fcadddc00c82a04","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-3","para":"35-3","html":"
The total amount of compensation cost recognized at the end of the requisite service period for an award of share-based compensation shall be based on the number of instruments for which the requisite service has been rendered (that is, for which the requisite service period has been completed). Previously recognized compensation cost shall not be reversed if an employee share option (or share unit) for which the requisite service has been rendered expires unexercised (or unconverted). To determine the amount of compensation cost to be recognized in each period, an entity shall make an entity-wide accounting policy election for all employee share-based payment awards to do either of the following:
  1. a
    Estimate the number of awards for which the requisite service will not be rendered (that is, estimate the number of forfeitures expected to occur). The entity shall base initial accruals of compensation cost on the estimated number of instruments for which the requisite service is expected to be rendered. The entity shall revise that estimate if subsequent information indicates that the actual number of instruments is likely to differ from previous estimates. The cumulative effect on current and prior periods of a change in the estimated number of instruments for which the requisite service is expected to be or has been rendered shall be recognized in compensation cost in the period of the change.
  2. b
    Recognize the effect of awards for which the requisite service is not rendered when the award is forfeited (that is, recognize the effect of forfeitures in compensation cost when they occur). Previously recognized compensation cost for an award shall be reversed in the period that the award is forfeited.
","snippet":"The total amount of compensation cost recognized at the end of the requisite service period for an award of share-based compensation shall be based on the number of instruments for which the requisite service has been re…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7797b5382d752d9babcdac3ffa4f96a1e507d1618150dd7221b0246321a77682","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-4","para":"35-4","html":"
An entity shall reverse previously recognized compensation cost for an award with a market condition only if the requisite service is not rendered.
","snippet":"An entity shall reverse previously recognized compensation cost for an award with a market condition only if the requisite service is not rendered.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fd931984fc6dd16678211bd01efb84ac6b04fab778361bb686f7fa638b8e1058","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:934572cb18f073734baf27b5a9e9daaff3928aa8c90f781d1ecfa92bb24c2c42","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"block":null,"heading":"Estimating the Requisite Service Period for Employee Awards","paragraphs":[{"citation":"718-10-35-5","para":"35-5","html":"
The requisite service period for employee awards may be explicit or it may be implicit, being inferred from an analysis of other terms in the award, including other explicit service or performance conditions. The requisite service period for an award that contains a market condition can be derived from certain valuation techniques that may be used to estimate grant-date fair value (see paragraph 718-10-55-71). An award may have one or more explicit, implicit, or derived service periods; however, an award may have only one requisite service period for accounting purposes unless it is accounted for as in-substance multiple awards. An award with a graded vesting schedule that is accounted for as in-substance multiple awards is an example of an award that has more than one requisite service period (see paragraph 718-10-35-8). Paragraphs
718-10-55-69 through 55-79
and
718-10-55-93 through 55-106
provide guidance on estimating the requisite service period and provide examples of how that period shall be estimated if an award's terms include more than one explicit, implicit, or derived service period.
","snippet":"The requisite service period for employee awards may be explicit or it may be implicit, being inferred from an analysis of other terms in the award, including other explicit service or performance conditions. The requisi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4a24ed0c8fb187da6fa46e2a2867a61ee4f581596c1aae873d578d7066420ee5","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-6","para":"35-6","html":"
The service inception date is the beginning of the requisite service period. If the service inception date precedes the grant date (see paragraph 718-10-55-108), accrual of compensation cost for periods before the grant date shall be based on the fair value of the award at the reporting date. In the period in which the grant date occurs, cumulative compensation cost shall be adjusted to reflect the cumulative effect of measuring compensation cost based on fair value at the grant date rather than the fair value previously used at the service inception date (or any subsequent reporting date). Example 6 (see paragraph 718-10-55-107) illustrates the concept of service inception date and how it is to be applied.
","snippet":"The service inception date is the beginning of the requisite service period. If the service inception date precedes the grant date (see paragraph 718-10-55-108), accrual of compensation cost for periods before the grant …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:37cc2970a99c735db61dad811dee27ed80cd1171ce77cd49bbcd6b0a69c61b0f","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-7","para":"35-7","html":"
An entity shall adjust that initial best estimate in light of changes in facts and circumstances. Whether and how the initial best estimate of the requisite service period is adjusted depends on both the nature of the conditions identified in paragraph 718-10-30-26 and the manner in which they are combined, for example, whether an award vests or becomes exercisable when either a market or a performance condition is satisfied or whether both conditions must be satisfied. Paragraphs
718-10-55-69 through 55-79
provide guidance on adjusting the initial estimate of the requisite service period.
","snippet":"An entity shall adjust that initial best estimate in light of changes in facts and circumstances. Whether and how the initial best estimate of the requisite service period is adjusted depends on both the nature of the co…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f475d0406abcf584250f9bfb9ab7840b53dab5f766cb8bc10065d521def9a946","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b1f8f41cff7e03732c4f44067591bed83a0a800d7d2731ac5701988e21ee8927","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"block":null,"heading":"Graded Vesting Employee Awards","paragraphs":[{"citation":"718-10-35-8","para":"35-8","html":"
An entity shall make a policy decision about whether to recognize compensation cost for an employee award with only service conditions that has a graded vesting schedule in either of the following ways:
  1. a
    On a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards
  2. b
    On a straight-line basis over the requisite service period for the entire award (that is, over the requisite service period of the last separately vesting portion of the award).
However, the amount of compensation cost recognized at any date must at least equal the portion of the grant-date value of the award that is vested at that date. Example 1, Case B (see paragraph 718-20-55-25) provides an illustration of the accounting for an award with a graded vesting schedule.
","snippet":"An entity shall make a policy decision about whether to recognize compensation cost for an employee award with only service conditions that has a graded vesting schedule in either of the following ways:\n(a) On a straight…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fe7e254b4c7a6f4d3a39a0dce82279632ef7de4f4f9dd1d392497e99f939b4a0","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:02bd4ec9b7d170947d8da422a11c88ede9e7d9d61e2d218b0f308178b76c7f1a","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"block":null,"heading":"Awards May Become Subject to Other Guidance","paragraphs":[{"citation":"718-10-35-9","para":"35-9","html":"
Paragraphs
718-10-35-10 through 35-14
are intended to apply to those instruments issued in share-based payment transactions with employees and nonemployees accounted for under this Topic, and to instruments exchanged in a business combination for share-based payment awards of the acquired business that were originally granted to grantees of the acquired business and are outstanding as of the date of the business combination.
","snippet":"Paragraphs 718-10-35-10 through 35-14 are intended to apply to those instruments issued in share-based payment transactions with employees and nonemployees accounted for under this Topic, and to instruments exchanged in …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:df94096c00d984158f51b5dd476324ef4e808f63bf866d77cb11780f62a45ad4","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-9A","para":"35-9A","html":"
Paragraph superseded by Accounting Standards Update No. 2020-06.
","snippet":"Paragraph superseded by Accounting Standards Update No. 2020-06.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:42b3c583e9312465b1b4eb7086497abed6ad624c0cc15a5660eef4e4759a28b0","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-10","para":"35-10","html":"
A freestanding financial instrumentor a convertible securityissued to a grantee that is subject to initial recognition and measurement guidance within this Topic shall continue to be subject to the recognition and measurement provisions of this Topic throughout the life of the instrument, unless its terms are modified after any of the following:
  1. a
    Subparagraph superseded by Accounting Standards Update No. 2019-08.
  2. b
    Subparagraph superseded by Accounting Standards Update No. 2019-08.
  3. c
    A grantee vests in the award and is no longer providing goods or services.
  4. d
    A grantee vests in the award and is no longer a customer.
  5. e
    A grantee is no longer an employee.
","snippet":"A freestanding financial instrumentor a convertible securityissued to a grantee that is subject to initial recognition and measurement guidance within this Topic shall continue to be subject to the recognition and measur…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3198ad616c4c08456a938735749062ce65347b28c0a990189bd75f1245d31b25","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-10A","para":"35-10A","html":"
Only for purposes of paragraph 718-10-35-10, a modification does not include a change to the terms of an award if that change is made solely to reflect an equity restructuring provided that both of the following conditions are met:
  1. a
    There is no increase in fair value of the award (or the ratio of intrinsic value to the exercise price of the award is preserved, that is, the holder is made whole) or the antidilution provision is not added to the terms of the award in contemplation of an equity restructuring.
  2. b
    All holders of the same class of equity instruments (for example, stock options) are treated in the same manner.
","snippet":"Only for purposes of paragraph 718-10-35-10, a modification does not include a change to the terms of an award if that change is made solely to reflect an equity restructuring provided that both of the following conditio…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:97cb0a1a8c1c5a4cebbb704f47d64d0ece72414ecd11718e09e77dd690ee2d29","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-11","para":"35-11","html":"
Other modifications of that instrument that take place after a grantee vests in the award and is no longer providing goods or services, is no longer a customer, or is no longer an employee should be subject to the modification guidance in paragraph 718-10-35-14. Following modification, recognition and measurement of the instrument shall be determined through reference to other applicable GAAP.
","snippet":"Other modifications of that instrument that take place after a grantee vests in the award and is no longer providing goods or services, is no longer a customer, or is no longer an employee should be subject to the modifi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ae360a0cdb0dbc634a5458f7cd1168236aa62b3914f301f4c67b982cce514757","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-12","para":"35-12","html":"
Once the classification of an instrument is determined, the recognition and measurement provisions of this Topic shall be applied until the instrument ceases to be subject to the requirements discussed in paragraph 718-10-35-10. Topic 480 or other applicable GAAP, such as Topic 815, applies to a freestanding financial instrument that was issued under a share-based payment arrangement but that is no longer subject to this Topic. This guidance is not intended to suggest that all freestanding financial instruments shall be accounted for as liabilities pursuant to Topic 480, but rather that freestanding financial instruments issued in share-based payment transactions may become subject to that Topic or other applicable GAAP depending on their substantive characteristics and when certain criteria are met.
","snippet":"Once the classification of an instrument is determined, the recognition and measurement provisions of this Topic shall be applied until the instrument ceases to be subject to the requirements discussed in paragraph 718-1…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8c53657b4c3898b87b8109de250600d8c7bc615e2b5d49844d6f7c3d3a6a89ca","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-13","para":"35-13","html":"
Paragraph superseded by Accounting Standards Update No. 2016-09.
","snippet":"Paragraph superseded by Accounting Standards Update No. 2016-09.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d73a68f913805b42eaf79306c8faef0e7116a3581435e26a93b5b5a4dd29a82d","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"citation":"718-10-35-14","para":"35-14","html":"
An entity may modify (including cancel and replace) or settle a fully vested, freestanding financial instrument after it becomes subject to Topic 480 or other applicable GAAP. Such a modification or settlement shall be accounted for under the provisions of this Topic unless it applies equally to all financial instruments of the same class regardless of the holder of the financial instrument. Following the modification, the instrument continues to be accounted for under that Topic or other applicable GAAP. A modification or settlement of a class of financial instrument that is designed exclusively for and held only by grantees (or their beneficiaries) may stem from the employment or vendor relationship depending on the terms of the modification or settlement. Thus, such a modification or settlement may be subject to the requirements of this Topic. See paragraph 718-10-35-10 for a discussion of changes to awards made solely to reflect an equity restructuring.
","snippet":"An entity may modify (including cancel and replace) or settle a fully vested, freestanding financial instrument after it becomes subject to Topic 480 or other applicable GAAP. Such a modification or settlement shall be a…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:29ea61471d80b78312b37c053742caa4619525b13f5a47bd28e3010a1397003e","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b8fab89a390a8ec7a60082224d09b25c02bd83f2e46fcb374a34ac7179f847f7","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},{"block":null,"heading":"Change in Classification Due to Change in Probable Settlement Outcome","paragraphs":[{"citation":"718-10-35-15","para":"35-15","html":"
An option or similar instrument that is classified as equity, but subsequently becomes a liability because the contingent cash settlement event is probable of occurring, shall be accounted for similar to a modification from an equity to liability award. That is, on the date the contingent event becomes probable of occurring (and therefore the award must be recognized as a liability), the entity recognizes a share-based liability equal to the portion of the award attributed to past performance (which reflects any provision for acceleration of vesting) multiplied by the award's fair value on that date. To the extent the liability equals or is less than the amount previously recognized in equity, the offsetting debit is a charge to equity. To the extent that the liability exceeds the amount previously recognized in equity, the excess is recognized as compensation cost. The total recognized compensation cost for an award with a contingent cash settlement feature shall at least equal the fair value of the award at the grant date. The guidance in this paragraph is applicable only for options or similar instruments issued as part of compensation arrangements. That is, the guidance included in this paragraph is not applicable, by analogy or otherwise, to instruments outside share-based payment arrangements.
","snippet":"An option or similar instrument that is classified as equity, but subsequently becomes a liability because the contingent cash settlement event is probable of occurring, shall be accounted for similar to a modification f…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e054f6f1e79760445bc100c1ec21d3b12e0078cae3e649d5678fbc8bb7980f67","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f98f30805ac503daa1b1b775c3b6192483f5f57acabc3b3c7dd48ed1f7b0d336","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:87d54551f32efb412c3dc63625efd1cffe42665e6c631f7a000bbe63390ac529","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:87d54551f32efb412c3dc63625efd1cffe42665e6c631f7a000bbe63390ac529","downloaded_from":"2026-09-10T01:03:38.493Z","last_downloaded_at":"2026-09-10T01:03:38.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480483","source_sha256":"aa7343aca3422afa4488cef54fba7599e51c881d10e7bf1cfba5a6800ed3de79"}}