options in financial statement analysis

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    Would anyone know how to treat Options when analyzing a financial statement. Both for valuation and assessing it as a good investment or not. Some companies issue stock options to their employees though I'm not sure how this fits into the picture of financial statement analysis.

    Buffet says that they should be treated as an expense though I'm not sure if that's a standard in Australia?

    Does anyone know? Any books that cover this topic specifically.

    Thanks very much.
 
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