What is Compensation Expense?
Compensation Expense Total costs incurred by an entity for employee services, including salaries, wages, bonuses, stock options, and related benefits, recognized in the period when earned in accordance with accrual accounting principles.
Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework
How is “Compensation Expense” Used in Practice?
Compensation expense includes salaries, bonuses, and share-based payments recorded under IFRS 2 and ASC 718.
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Who Needs to Know This Term?
- Financial Analysts
- Bankers
- Traders
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What is Compensation Expense?
Total costs incurred by an entity for employee services, including salaries, wages, bonuses, stock options, and related benefits, recognized in the period when earned in accordance with accrual accounting principles.
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