COBRA: a snake in the employee benefits garden
Article Abstract:
The Comprehensive Omnibus Budget Reconciliation Act (COBRA) of 1985 amended the Employee Retirement Income Security Act (ERISA) of 1975 in order to guarantee group health insurance coverage for employees that would have lost coverage through termination or other specific events. COBRA applies to all companies covered by ERISA. The six qualifying events that lead to the continuation of coverage are death of covered employees, termination or reduction of hours for reasons other than misconduct, divorce or legal separation of covered employees, eligibility for Social Security benefits, cessation of dependency of a dependent child, and bankruptcy proceedings under Title 11. There are four categories of qualified beneficiaries: covered employees who retired before the cessation of coverage, and spouses, covered employees, dependent children, and surviving spouses of covered employees.
Publication Name: Management Accounting (USA)
Subject: Business, general
ISSN: 0025-1690
Year: 1991
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Computing employee stock option values with a spreadsheet
Article Abstract:
A method for determining the value of employee stock options is developed. Traditionally, compensation experts employ mathematical models and special software packages to compute these values. However, an alternative method that uses only a simple spreadsheet program can make their task easier. This spreadsheet approach is based on Noreen and Wolfson's upgrade of the Black-Scholes option pricing model. The information used in this model are current stock price, exercise price of option, risk-free interest rate, expected life of the option, stock price volatility and expected dividend yield of the stock. By using this approach, employers can effectively manage their compensation schemes and make the necessary footnote disclosures in their financial statements.
Publication Name: Management Accounting (USA)
Subject: Business, general
ISSN: 0025-1690
Year: 1997
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