The FASB has issued ASU No. 2021-07, Compensation – Stock Compensation (Topic 715):   Determining the Current Price of an Underlying Share for Equity-Classified Share-Based Awards. This ASU allows private companies to determine the current price input of equity-classified, share-based awards using the reasonable application of a reasonable valuation method. The characteristics of this method are the same as the characteristics used in the regulations of the U.S. Department of the Treasury related to Section 409A of the U.S. Internal Revenue Code to describe the reasonable application of a reasonable valuation method acceptable for income tax purposes.

The ASU is effective for fiscal years starting after December 15, 2022. Early adoption is permitted, including for statements that have not yet been issued as of the ASU release date.

The full text of ASU 2021-07 is available here.

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