// service_03 / equity.compensation
Equity Programs Accounted
for Accurately
Stock options, RSUs, ESPPs, and performance shares each carry specific accounting requirements under ASC 718. Synthfin handles the fair value calculations, compensation expense recording, vesting schedule tracking, and disclosure preparation — so your equity accounting is clean, current, and ready for your auditors and investors.
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What this engagement delivers
Equity compensation is one of the more technically demanding areas of accounting for technology companies. The grant-date fair value calculations, the attribution of expense over vesting periods, the treatment of forfeitures, modifications, and early exercises — each requires specific handling under ASC 718, and errors compound over time as the pool grows.
When this engagement is complete, your stock-based compensation expense is accurately recorded, your vesting schedules are reconciled, and your disclosure notes are ready for your financial statements — with full documentation for your audit team.
Grant-date fair values calculated using appropriate valuation methods for each award type
Compensation expense recorded and attributed correctly over vesting periods
Vesting schedules tracked and reconciled to your equity administration platform
ASC 718 disclosure schedules prepared for your financial statement notes
Coordination with your equity platform so the accounting matches the cap table
// identified.challenge
Where equity compensation accounting tends to create problems
problem_01
Fair value calculations done inconsistently
Stock options require a Black-Scholes or lattice model calculation using specific inputs — expected term, volatility, risk-free rate, and dividend yield. When these inputs aren't applied consistently across grant dates, the compensation expense is wrong from the start and auditors will find it.
problem_02
Vesting schedules that drift from the cap table
When the accounting records and the equity administration platform aren't reconciled regularly, differences accumulate. By the time they're discovered — usually at audit — the reconciliation work is time-consuming and the explanations are difficult to reconstruct.
problem_03
Modifications and terminations treated incorrectly
Grant modifications — accelerated vesting, extended post-termination exercise periods, price reductions — each have specific accounting consequences that differ depending on whether the modification is beneficial to the employee. Treating them uniformly produces the wrong expense numbers.
// our.approach
How we handle it
fair_value_calculation
Grant-date fair value determination
We calculate grant-date fair values for each award type using the appropriate valuation model. For stock options, we apply Black-Scholes with supportable inputs documented for each grant date. For RSUs and performance shares, we use the grant-date stock price with appropriate adjustments where applicable.
expense_attribution
Compensation expense recording
We record compensation expense in the correct periods using straight-line or graded attribution as required by the award terms, and we apply forfeiture accounting consistently. Each period's expense entry is traceable to the underlying grants and vesting activity.
platform_integration
Equity platform coordination
We work with your equity administration platform — Carta, Pulley, or similar — to reconcile vesting activity, exercises, and cancellations against the accounting records. When the platform and the books agree, audit is straightforward. When they don't, we find and resolve the difference before it becomes a larger problem.
disclosure_preparation
ASC 718 disclosure schedules
We prepare the footnote disclosures required by ASC 718 — the option activity rollforward, weighted-average fair value assumptions, unrecognized compensation cost, and vesting period analysis. These are formatted for inclusion in your financial statements and reviewed against the underlying data before delivery.
// what.to.expect
How the engagement runs
phase_01
Plan and grant review
We review your equity plan documents, grant agreements, and cap table to understand the award types in place, the vesting terms, and any modifications or unusual provisions that require specific accounting treatment.
phase_02
Fair value and expense setup
We calculate fair values for each grant cohort, build the compensation expense amortization schedule, and establish the methodology documentation that supports the numbers for audit purposes.
ongoing
Period-end close support
Each reporting period, we update the expense schedule for new grants, vesting events, exercises, and cancellations — and reconcile the accounting records to your equity platform. New award types or plan amendments are incorporated as they occur.
audit_prep
Disclosure and audit support
We prepare the ASC 718 disclosure package for your financial statements and stay available during your audit to walk auditors through the methodology, provide support schedules, and respond to follow-up questions.
// service.investment
Service pricing
service_03
Equity Compensation Accounting
$2,800 USD
Engagement covering setup of the full equity accounting framework plus one reporting period — fair value calculations, expense schedule, platform reconciliation, and disclosure preparation.
Grant-date fair value calculations for stock options, RSUs, ESPPs, and performance shares
Compensation expense amortization schedule with straight-line or graded attribution
Vesting schedule tracking and reconciliation to your equity administration platform
Treatment of modifications, exercises, and cancellations as they occur
ASC 718 disclosure schedules formatted for your financial statement notes
Auditor support during your financial statement audit
// pricing.note
The base fee covers setup and one reporting period. Ongoing quarterly or annual support is available as a continuing engagement at a rate agreed at the outset. Companies with a large grant pool, multiple equity plan types, or complex modification history may require additional scope — which we'll identify and confirm before work begins.
// designed.for
This service fits well if you are a
— Technology company offering stock options, RSUs, or other equity incentives to employees and advisors
— Business preparing for a first financial statement audit that includes equity compensation
— Company that has grown the equity pool significantly and needs the accounting caught up
— Team whose equity platform and accounting records have diverged and need reconciling
// methodology.framework
The standard we work to
ASC 718 — Award Types We Handle
Non-qualified stock options
Black-Scholes fair value, straight-line or graded expense attribution over vesting period
Incentive stock options
Fair value calculation and expense recording; disclosure of ISO-specific items for tax and financial reporting
Restricted stock units
Grant-date stock price valuation, expense recognition over service or performance vesting conditions
Employee stock purchase plans
Compensatory vs. non-compensatory assessment, fair value of the purchase right where applicable
Performance shares
Probability-weighted expense recognition based on performance condition assessment each period
// recent.work
March 2026
Integrated with a client's Carta account to reconcile RSU vesting schedules across two grant cohorts, resolved a three-quarter divergence between the cap table and the general ledger, and produced ASC 718 disclosure notes for their annual financial statements.
February 2026
Rebuilt the stock option expense schedule for a Series A company that had not applied consistent fair value inputs across grant dates. Restated two prior periods and prepared clean disclosure schedules ahead of their first audited financial statements.
// typical.timeline
Initial setup — plan review, fair value calculations, and expense schedule construction — typically runs two to three weeks. Ongoing period-end deliverables are produced within five business days of your close date.
// our.commitment
How we approach the relationship
platform_reconciled
The accounting matches the cap table
We don't treat the equity platform and the accounting records as separate systems. Every period, we reconcile them so your auditors and investors are looking at numbers that agree — and any differences are explained, not glossed over.
documented_inputs
Every assumption is documented
The inputs used in fair value calculations — expected term, volatility selection, risk-free rate — are documented and supported at each grant date. When an auditor asks why a particular volatility assumption was used for a March 2025 grant, we have the answer ready.
initial_conversation
Start with a conversation
If you're not sure where your equity accounting stands, or whether it needs attention before your audit, reach out. We can talk through your situation and give you a clear read on what's involved — before any commitment is made.
// next.steps
Getting started is straightforward
step_01
Send a message
Describe your equity program — award types in use, approximate grant pool size, equity platform, and what your current accounting situation looks like. That context helps us come to the first conversation prepared.
step_02
Initial review call
We'll review what you have, ask questions about your grant history and any modifications or complications, and give you a clear picture of what the engagement would involve and how long it would take.
step_03
Written scope and kickoff
We'll send a written scope confirming deliverables, timeline, and fee. Once agreed, we request access to your equity platform and grant documents and get to work — no prolonged onboarding process.
// take.action
Ready to get your equity accounting in order?
Whether you're heading into your first audit, catching up on a backlog, or simply want confidence that the numbers are right — reach out and we'll figure out what needs to be done and how to get there.
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