NOTE 3. STOCK-BASED COMPENSATION

In accordance with ASU No. 2016-09, the Company records any excess tax benefits or deficiencies from its equity awards in its Consolidated Statements of Income in the reporting periods in which vesting occurs. As a result, the Company’s income tax expense and associated effective tax rate are impacted by fluctuations in stock price between the grant dates and vesting dates of equity awards.

For the three months ended September 30, 2019 and 2018, the effect of the adoption of ASU No. 2016-09 was a decrease of tax expense by $325 thousand and $115 thousand, respectively, resulting in an increase of basic and diluted earnings per share by approximately $0.02 and $0.01, respectively. For the nine months ended September 30, 2019 and 2018, the effect of the adoption of ASU No. 2016-09 was a decrease of tax expense by $745 thousand and $744 thousand, respectively, resulting in an increase of basic and diluted earnings per share by approximately $0.04 for each of the periods.

The Company is estimating forfeitures, rather than accounting for forfeitures as they occur.

Reported stock-based compensation expense was classified as follows (in thousands):


	Three months ended				Nine months ended
	September 30,				September 30,
	2019		2018		2019		2018
Casino	$	51	$	17	$	152	$	98
Food and beverage		52		15		150		89
Hotel		28		17		71		38
Selling, general and administrative		896		853		2,572		2,068
Total stock-based compensation, before taxes		1,027		902		2,945		2,293
Tax benefit		(216)		(189)		(618)		(482)
Total stock-based compensation, net of tax	$	811	$	713	$	2,327	$	1,811