Accountancy Part AAccounting for Shares

Employees Stock Option Plan (ESOP) can be offered by a company to:

Answer & explanation

Correct answer: option 1

The correct answer is Option (1) → Only to its employees and employee directors

NCERT (2026-27 edition):
Employees Stock Option Plan (ESOP) – “A company may offer option to its employees and employee directors to subscribe shares of the company at lower than its market value or fair value at a future date. It is known as Employees Stock Option Plan (ESOP). It being an option granted by the company, an employee may or may not exercise the right to subscribe.”