Chicago-based Unitrin Inc. announced that beginning with the first quarter of 2003, it will expense stock options granted to employees and directors using the “prospective” method under Statement of Financial Accounting Standards No. 123 as amended by SFAS No. 148.
Under this method, Unitrin will expense the fair value of all employee and director stock options granted after Jan. 1, 2003. Unitrin expects that the after tax expense associated with expensing stock options for 2003 will be approximately $1.6 million or 3 cents per share.
Historically, Unitrin had applied Accounting Principles Board Opinion No. 25 and related Interpretations in accounting for its stock option plans. Accordingly, no significant compensation cost has been recognized for its stock option plans prior to 2003.
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