At 1 January 2016 Aberdeen plc decides to grant 400 share options to each of its 1800 employees. To receive the options, they should work for the company for the next 4 years. The fair value of the options at the grant date is 5. The following table shows the number of employees leaving in each year as well as those expected to leave by the end of year 4.

Year	Employees leaving during year	Further employees expected to leave by end of year 4
2016	60	260
2017	80	140
2018	70	50
2019	35	-

Required:

1. Calculate the expense to be recognized for the above equity-settled share based compensation.

2. The recognition of an expense for equity-settled share-based payments has been controversial. Briefly discuss the arguments for and against the recognition of an expense.