Exams

Audience: New professionals

Experience: < 2 years of equity compensation experience

Relationship with internal and external service providers: General knowledge of responsibilities; interaction limited to specific functions

Relationship with equity plans: reactive

Knowledge base: Policies, procedures, and routine transactions

Fundamentals in Equity Compensation (ECA Exam)

• A basic understanding of corporations and the frameworks for corporate governance and finance
• An understanding of why corporations use equity compensation
• The ability to differentiate between types of equity compensation
• A working knowledge of equity compensation terminology
• A familiarity with the basic procedures necessary to effectively administer an equity compensation program
• The ability to read and interpret plan documents

Audience: Experienced stock plan professionals

Experience: Passed Level 1; > 2 years of equity compensation experience

Relationship with internal and external service providers: Understands participation of internal departments and external service providers in administering employee equity compensation plans. May make recommendations to decision makers regarding selection of service providers

Relationship with equity plans: Interactive

Knowledge base: All aspects of plan administration, including roles of internal and external service providers

Intermediate Equity Compensation (Level II)

• A thorough working knowledge of the basic tax, accounting, securities law, and corporate law aspects of equity compensation plans
• A thorough understanding of certain common equity compensation-related transactions and issues
• Familiarity with the specific code and regulatory provisions applicable to equity compensation programs
• Familiarity with global implications of equity compensation plans

Audience: Experienced stock plan professionals with managerial and/or consultative responsibilities

Experience: Passed Level 2; exposure to various types of multidimensional plans

Relationship with internal and external service providers: Serves as liaison between all internal and external constituencies. Decision maker in service provider selection process. Holds service providers accountable. Often serves as consultant.

Relationship with equity plans: Proactive

Knowledge base: A complete understanding of the interrelated responsibilities of all equity compensation knowledge domains

Advanced Equity Compensation (Level III)

• Ability to identify, analyze, and help resolve complex problems, with particular skills in situations that require an understanding of the interaction among several technical areas
• An understanding of special equity compensation transactions and issues, such as issues related to corporate governance
• An understanding of cash-based equity compensation programs, as well as an in-depth understanding of advanced employee stock plan financing methods and certain complex tax and accounting issues
• Advanced understanding of global implications of equity compensation plans

1) Corporate and Securities Law

• Effects of resale and registration requirements and exemptions of the Securities Act of 1933 as applied to privately-owned and publicly-held companies
• Securities Exchange Act of 1934 requirements for periodic reporting, proxy solicitation, tender offers, and insider trading
• Characteristics and authority of public and private companies - board of directors, business entities, blue sky laws

2) Accounting

Accounting implications to equity compensation of:

• Accounting Standards Codification Topic 718 - ASC 718 (Previously Financial Accountings Standards Board Statement No. 123 Revised "FAS 123R")
• IFRS 2
• Financial Accountings Standards Board Interpretation No. 28 ("FIN28")

3) Taxation

Implications of taxation rules surrounding equity compensation plans:

• Internal Revenue Code Nos. 421, 422, 423, 424
• Knowledge of income tax collection and deduction rules applicable to companies and to recipients of equity compensation

4) Equity Plan Design, Analysis, and Administration

• Awareness of the different equity compensation vehicles and requirements
• Knowledge of various processes and procedures to accomplish equity compensation goals
• Understanding of standard and unique equity compensation plan provisions and documents and their effects to recipients and the company
• Insight into shareholder concerns and considerations with respect to equity compensation

*Note:  Beginning with the 2012 exams, the CEPI will include 10% experimental items on the tests.  Experimental items are unscored, unidentified items, and may not adhere to these percentages.  Scored items WILL reflect this weighting.