Schwarzwald Schokolade is a German chocolate booth at the annual Christkindlmarket in the town square of Heilbronn. The entity is looking to expand to Chicago's Christkindlmarket. Schwarzwald Schokolade also has several executives that have been granted graded-vesting stock options that vest over the next five years. Which of the following is a difference between U.S. GAAP and IFRS with regard to graded vesting?

Question

Quizplus · Accepted Answer

Under U.S. GAAP, each tranche in a graded-vesting stock option plan is treated as a separate award with its own vesting period, which can result in a different expense recognition pattern over the vesting period compared to IFRS, which allows an entity to recognize the expense on a straight-line basis over the entire vesting period unless an entity chooses to account for each tranche separately.

Schwarzwald Schokolade Is a German Chocolate Booth at the Annual