It is very common for locally established venture companies to grant stock options to employees, but recently, there have been an increasing number of cases where employees of US subsidiaries are granted stock options at the Japanese headquarters. For US accounting purposes, the accounting treatment for stock options is described in ASC 718. Under US GAAP, stock-based compensation must be expensed. It is, in principle, measured on the basis of “fair value on the date of grant of Equity instruments” and the costs are recognized as costs over the period in which the employee must provide work as a condition of compensation. Our office provides cost recognition calculation, advice and consultation on items to be disclosed in financial statements, and issues related to taxation when individual employees exercise their options (such as taxation issues by ISO and NSO).