NASDAQ OMX Group (NDAQ)

Future Accounting Requirements

FIN 48 —In June 2006, the FASB issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109,” or FIN 48. FIN 48 clarifies the accounting for income taxes, by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. FIN 48 is effective for us on January 1, 2007. The cumulative effect of adopting FIN 48 will be recorded in retained earnings and other accounts as applicable in the Consolidated Balance Sheet. The effect of adopting FIN 48 did not have a significant impact on our consolidated financial position or results of operations.

SFAS No. 157—In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements,” or SFAS 157. SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. SFAS 157 is effective for us on January 1, 2008. We are currently evaluating the potential impact of adopting SFAS 157.

SFAS No. 158—In September 2006, the FASB also issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans- an amendment of FASB Statements No. 87, 88, 106 and 132(R),” or SFAS 158. We adopted the recognition and disclosure requirements under SFAS 158 as of December 31, 2006. See Note 11, “Employee Benefits,” to the consolidated financial statements for further discussion. SFAS 158 also requires plan assets and obligations to be measured as of the employer’s balance sheet date. While the new measurement date is effective for us on December 31, 2008, we are in compliance with the measurement date provision.

Future Accounting Requirements

In December 2004, the FASB issued Statement of Financial Accounting Standards 123 (revised 2004), “Share-Based Payment,” or, SFAS 123(R), which revises SFAS 123, “Accounting for Stock-Based Compensation,” or, SFAS 123, and supersedes Accounting Principles Board Opinion 25, “Accounting for Stock Issued to Employees,” or, APB 25. SFAS 123(R) also amended SFAS 95, “Statement of Cash Flows.” SFAS 123(R) requires that new, modified and unvested share-based payment transactions with employees, such as

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stock options and restricted stock, be recognized in the financial statements based on their fair value and recognized as compensation expense over the vesting period.

We adopted SFAS 123(R) effective January 1, 2006, using the modified prospective transition method, and will recognize share-based compensation cost on a straight-line basis over the requisite service periods of awards. Under the modified prospective method, non-cash compensation expense will be recognized for the portion of outstanding stock option awards granted prior to the adoption of SFAS 123(R) for which service has not been rendered, and for any future stock option grants. The pro forma information presented in Note 10, “Stock Compensation and Stock Awards,” presents the estimated compensation charges under SFAS 123(R). Nasdaq’s assessment of the estimated compensation charges is affected by the Company’s stock price as well as assumptions regarding a number of complex and subjective variables and the related tax impact. These variables include, but are not limited to, Nasdaq’s stock price volatility and employee stock option exercise behaviors.

In 2004, the EITF issued EITF 03-1, “The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments,” to provide detailed guidance on assessing impairment losses on debt and equity investments. In September 2004, the FASB voted unanimously to delay the effective date of EITF 03-1. On November 3, 2005, the FASB issued FASB Staff Position FAS 115-1, “The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments,” revising the guidance in EITF 03-1, which did not have a material impact on Nasdaq’s consolidated financial statements. The disclosures required by EITF 03-1 are included in Note 5, “Investments,” to the consolidated financial statements.

Future Accounting Requirements

In December 2004, the FASB issued Statement of Financial Accounting Standard (“SFAS”) No. 123 (revised 2004), “Share-Based Payment” (“SFAS 123(R)”), which is a revision of SFAS No. 123, “Accounting for Stock-Based Compensation” (“SFAS 123”). SFAS 123(R) supersedes Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” (“APB 25”) and amends SFAS No. 95, “Statement of Cash Flows”. Generally the approach in SFAS 123(R) is similar to the approach described in SFAS 123. However, SFAS 123(R) requires Nasdaq to expense in the Consolidated Statements of Income all share-based payments to employees, including grants of employee stock options, based on their fair values. This cost will be recognized over the vesting period of the grants. Pro forma disclosure will no longer be an alternative. Nasdaq must adopt SFAS 123(R) no later than July 1, 2005. We cannot predict the impact of adoption of SFAS 123(R) because the impact will depend on the levels of share-based payments granted in the future. However, had we adopted SFAS 123(R) in prior periods, the impact of that standard would have approximated the impact of SFAS 123 as described in the disclosure of pro forma net income and earnings per share in Note 15 “Stock Compensation and Stock Awards” to the consolidated financial statements for further discussion.

In March 2004, the EITF issued EITF No. 03-1, “The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments” (“EITF 03-1”) which provides new guidance for assessing impairment losses on debt and equity investments. Additionally, EITF 03-1 includes new disclosure requirements for investments that are deemed to be temporarily impaired. In September 2004, the FASB voted to delay the accounting provisions of EITF 03-1; however, the disclosure requirements remain effective and have been adopted for Nasdaq’s year ended December 31, 2004 and are included in Note 8 “Investments” to our consolidated financial statements. Once issued, Nasdaq will evaluate the impact of adopting EITF 03-01.

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