Stock Options Should Be Disclosed

Re: “Greenspan Repeats Call to Expense Stock Options” [May 4].

Much has been discussed recently about improper and misleading accounting, but one of the most egregious forms of distortions of reported earning has been endorsed in the boardrooms of many of our elite corporations and has been supported at the political level from President Bush on down.

I refer to the failure to expense as compensation stock options issued to officers and other employees.

It has recently been estimated that shares issued upon the exercise of options make up approximately 15% of outstanding shares.

In many cases, those shares were acquired by the company going into the open market and buying them, expending billions of dollars, money that could have been spent to shore up balance sheets, pay down debt, invest in job-creating activities or pay dividends to shareholders.

Two of the most respected men in our economic universe, Warren Buffett and Fed Chairman Alan Greenspan, have recently come out strongly against the present accounting treatment. We should listen to them.

Robert F. Rosenstiel

Beverly Hills