FOR IMMEDIATE RELEASE December 16, 2004

CONTACT: Brendan Daly/Jennifer Crider 202-226-7616

Pelosi Statement on FASB Stock Options Decision

Washington, D.C. – House Democratic Leader Nancy Pelosi released the following statement today on the Financial Accounting Standards Board’s final standard for expensing of stock options:

“The Financial Accounting Standards Board’s decision to ignore the growing consensus that its proposed standard will not work is regrettable.

“The Board had every opportunity to do the right thing – to take seriously the thousands of comments it received from the public and from Members of Congress and to test the different valuation proposals to see which method comes closest to an accurate value.  Instead, the Board adopted its own pre-conceived expensing standard without change, punting the real work to the Securities and Exchange Commission. 

“Last month, Senate Democratic Leader Harry Reid and I wrote to President Bush asking him to urge the SEC to take action.  The SEC should pull together a group of experts to conduct more research and test various valuation methods to find a method that is accurate and reliable.  It is crucial that the SEC spend the time it needs and do the research required to get the right answer.  Broad-based stock options have played a key role in the growth of our economy and remain a critical tool for attracting the skilled talent that is so vital to our prosperity at home and our competitiveness abroad. 

“Congress must continue to play a central role in ensuring these objectives are met, whether through oversight, legislation, or both.  We cannot fail America’s rank and file workers, who bear the brunt of options cutbacks, or our small businesses and entrepreneurs, or the investing public.”

“ Democrats are united in presenting a New Direction for America, one that will make our nation as strong as its people, one that brings opportunity, security, and prosperity to all Americans. ”

Democratic Leader Nancy Pelosi