Performance Equity Awards are becoming increasingly more popular, especially with public entities. However, private companies are also adopting policies to incorporate performance awards as part of their overall compensation strategies.

This course is designed to provide you with a fundamental understanding of Performance Equity Awards, when they are most appropriate to implement, and the accounting treatment of these awards (and differences) from both a FAS and IFRS perspective.

We will cover:

  • Specific examples of Performance-Based Equity Awards including restricted stock and options
  • Step-by-step accounting treatments, from valuation to expense entries
  • The most popular Performance-Based Equity Award revisions to plan
  • Less common practices and how these can be difficult to track and account for in the financial statements

Course Series

This course is included in the following series:

10 CoursesFinance for Entrepreneurs

  1. Start-up Equity and Cap Table Basics
  2. Understanding Performance-Based Equity Awards
  3. Accounting 101: How To Do Basic Accounting In One Hour
  4. Learn Finance Principles in 1 Hour
  5. Financial Modeling Using Excel
  6. The Evolution of a Great Spreadsheet Report - How to Effectively Present Numbers in the Business World
  7. Creating a Winning Pitch for Venture Capital Investors
  8. Venture Capital Valuation Analysis Method
  9. Enterprise Risk Management 101
  10. The IPO Preparation Process - Preparing a Company to Access the Public Markets
Learning Objectives
  • Describe what performance equity awards are and how they are used
  • Articulate the most common awards utilized, including the pros and cons
  • Review accounting for performance equity, including FASB and IFRS
  • Review modifications, accelerations and other factors that affect payout vesting
  • Describe new regulatory changes
Last updated/reviewed: March 8, 2024
39 Reviews (188 ratings)

Reviews

5
Anonymous Author
The instructor provided a thorough overview of performance based equity awards. I particularly enjoyed reviewing the various valuation methodologies and regulatory implications. As a recipient of equity-based stock awards, which are included within my total rewards comp package, this course also provided valuable insights into how LTIPs are structured and governed.

4
Anonymous Author
Lots of information on each slide. However, it's hard to digest since presenter reads each bullet point, almost verbatim. Good repetition of key concepts. Would like to see less words and more visual displays of information (ex. tabular comparisons of "Type I, II, III" etc.) with detailed information in a reference resource (like the glossary).

4
Member's Profile
The content was good and very comprehensive, but overall I think they would land better if they were accompanied by mathematical / illustrative examples. It's hard to get the full picture with just words and discussion.

5
Anonymous Author
This lesson was my first time learning about performance based equity awards. I have not yet worked with a company that offers this, but it is important to have some knowledge about this for the future.

4
Anonymous Author
It's nice to see a course on performance based equity awards. To be honest with you, I have never worked for a company until now; but, the performance target is on churn and keeping that at bay.

4
Member's Profile
the content assumed more familiarity with ASC 718 topics. Would have been helpful to include resources for further information of definitions (ie- what Monte Carlo is) sooner in the lecture

4
Member's Profile
To be honest, I rather read from the textbook instead of listening in. Reading through the slides with slight modification does not really help me to understand the whole thing.

4
Anonymous Author
I was not as familiar with this topic. Although the course did expand my knowledge, there were many concepts that were new to me so the course was a bit difficult to follow.

4
Member's Profile
Good material. It seems like more examples of the accounting showing initial booking, amortization and adjustments would make the course better.

4
Member's Profile
Although a lot of this course was a bit over my head, This was a useful course. I wish that the materials were a bit more in line with the exam.

5
Anonymous Author
The course provides overall understanding of the Performance based Equity awards. However this may be updated with recent data / studies.

5
Anonymous Author
The material was relevant and well laid out. A facts couples with trends kept me engaged and answered questions I was curious about.

5
Member's Profile
I liked the Tim Cook example. More examples would be helpful in making the subject matter more interesting and easier to learn.

4
Anonymous Author
Good information and overview. Wish more examples were provided with the handouts so they could be reviewed after class.

4
Anonymous Author
Too much text on the slides. Showing exactly examples of how to calculate the reward valuations would have been helpful.

4
Anonymous Author
The slides in the supporting materials did not include all the slides in the presentation. However, they were helpful.

3
Anonymous Author
Instructor not very engaging. Often just read slides. Course does give good technical knowledge over topic.

5
Member's Profile
Nice overview of key terms, valuation methods and pros/cons of common performance based equity awards.

4
Member's Profile
Would benefit from a broader utilization of examples interspersed in the presentation materials

4
Anonymous Author
Interesting topic, but not all the slides were provided which made it difficult to take notes.

4
Anonymous Author
This was very helpful in understanding more about performance based equity awards. thank you.

4
Member's Profile
Good information covering the various combination models of equity awards. Pace was good.

3
Member's Profile
Slides are very bad for completing exam. A great part of the material is missing.

5
Anonymous Author
Nice course on Understanding Performance-Based Equity Awards. Would recommend.

5
Member's Profile
A great and detailed overview of performance equity - really comprehensive!

4
Anonymous Author
Links to good black scholes or monte carlo calculators would be beneficial

3
Member's Profile
Complex topic that requires more examples and not just reading the slides

5
Anonymous Author
I always enjoy taking classes about equity and stock and performance

5
Member's Profile
Excellent course, informative and immediately applicable to my job.

4
Anonymous Author
Good slides but overall the course a bit dry and seems outdated

3
Member's Profile
This course was a good beginner course for equity based awards.

5
Member's Profile
boring course......very boring!!!!!!!!!!!no other comments

5
Anonymous Author
Great introduction to the different equity plan options.

3
Member's Profile
I did not enjoy having the slide content read to me.

5
Member's Profile
very clear and easy to follow, in a complex topic!

4
Member's Profile
Difficult subject if not versed in it.....

4
Member's Profile
slide content was a bit confusing

4
Anonymous Author
good course

4
Member's Profile
Good

Prerequisites
Course Complexity: Intermediate

Prerequisite: Exposure to employee compensation plans

  • An understanding of the basics of FASB 123R (Topic 718) is recommended
  • An understanding of equity based stock options and their utilization as compensation is preferred.

 

Advanced Preparation: None

 

Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
Course Syllabus
INTRODUCTION AND OVERVIEW
Performance Based Equity Awards
  Performance Equity Awards Defined5:50
  Examples of Performance and Market Awards16:04
Valuation and Modifications
  Valuation Methodologies 5:32
  Modifications9:17
Changes and Trends
  Recent Regulatory Changes 6:30
  Trends in Performance Equity Awards7:35
CONCLUSION
  Conclusion and Additional Resources4:04
SUPPORTING MATERIALS
  Slides: Understanding Performance Based Equity AwardsPDF
  Understanding Performance Based Equity Awards Glossary/IndexPDF
REVIEW & TEST
  REVIEW QUESTIONSquiz
 FINAL EXAMexam