by: Barth, Mary E.; McEntee, Justin J.
Source: Stanford Graduate School of Business
An equity research analyst is trying to decide how to analyze Silicon Graphics' financial performance. The company reports net income but discloses that it would have had a net loss if its employee stock option-based compensation had been recognized as an expense in the income statement. This case deals with whether and how to measure stock-based employee compensation and its effects on financial performance and investor perceptions of firm value.
Link: Silicon Graphics, Inc.
Publication Date: 2000-02-01