Uploading Custom Assumptions

Some clients may wish to use their own values for the Black-Scholes Option Pricing Model or use custom assumptions to be used in the Black-Scholes calculation. This can be done by navigating to Compliance >> Expense accounting and selecting Manage Assumptions.  

Once here, you select individual awards to apply the custom assumptions to by selecting the box next to the grant number.

Or you can select all awards to apply the custom assumptions as seen below. 

Once the awards are selected, click the blue Actions button and select edit expense detail.


A modal will then pop-up on the screen, prompting you to select which assumption you would like to change. Here you will be able to upload a custom term, interest rate, volatility, fair value (or option value as calculated offline in your own Black-Scholes calculator), the amortization method, or the expense status (where you can choose to include or exclude any awards).

Note that if you are attempting to edit the custom expected term, Carta will need you to also upload a custom interest rate and volatility as our calculation for these inputs are based on the Simplified Method to determine expected term. If you need assistance calculating the interest rate and volatility based on your custom term assumption, reach out to 718@carta.com and we can provide you with a template to calculate those. 

Additionally, we can upload multiple custom assumptions for the awards by using a bulk assumptions importer. Please reach out to 718@carta.com if you would like to utilize this spreadsheet to bulk upload assumptions.

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