GuerdonNews® Volume 6 Number 6

July 2010


Welcome to the July 2010 issue of GuerdonNews®

And happy new financial year to our Australian subscribers. In this issue we:

• Express a concern that some relative TSR outcomes post the GFC may not reward good performance consistency and risk management

• Summarise further Australian Taxation Office guidance on employee share scheme taxation

• Review the Australian Institute of Company Directors (AICD) paper on company remuneration reports

• Summarise new employer share plan tax reporting requirements

We conclude with the latest on executive and director remuneration disclosure updates available on the GuerdonData® on-line database and references to Guerdon Associates in the news media.

Taking a hit in the GFC could have unfair executive pay results

Companies whose share price dropped the most during the recent GFC may see their executives receive windfall rewards if they have awarded share based remuneration contingent on relative TSR rankings.

The converse is also true. If the share price was not adversely affected during the GFC, then relative rankings are likely to drop leaving good performance unrewarded as share price recovery occurs in peer companies.

More Australian Taxation Office guidance on taxation of employee share schemes

During June 2010, the Australian Taxation Office (ATO) released several guidance notes on employee share scheme taxation.

The guidance covers matters ranging from administration to discussion on what constitutes a real risk of forfeiture for tax deferral purposes.

This article summarises what now constitutes a real risk of forfeiture for tax deferral purposes.

The AICD has a go at fixing remuneration report complexity

On 5 June 2010 the Australian Institute of Company Directors (AICD) released a position paper on company remuneration reporting.

This article provides a brief summary of the AICD’s paper, and suggests areas that may need some hard thinking before progressing too far down a reform track in an era where companies and their shareholders are suffering from perhaps too much regulatory “stimulus”.

New share plan tax reporting requirements to be complied with from 14 July 2010

The deadline for employers to provide employees with an annual share scheme statement is 14 July 2010, while the deadline for the company's ATO share scheme annual report is 14 August 2010.

This article summarises what employers need to provide.

Latest GuerdonData® Updates

Updates to GuerdonData® include disclosures from the following 5 companies:

CSR Limited, James Hardie Industries NV, Programmed Maintenance Services Ltd, Singapore Telecommunications Limited, and SP Ausnet.

Executive and director remuneration data from all ASX 300 companies on GuerdonData® is available to any subscriber. Visit our website for more information on GuerdonData®.

Assess how easily you can find out director and executive pay information by viewing our 6 minute demo. Click on the “More Info” button below.

Guerdon Associates in The News

“Macquarie Group Limited; Notice of Annual General Meeting”, ASX ComNews, 18 June 2010

“Bonus resetting rewards failure”, Patrick Durkin, The Australian Financial Review, 2 July 2010, p.3


The information, analysis and opinion in this e-mail and attachments are intended to be for informational purposes only. Analyses are based on information taken from public documents or private surveys, and we do not represent to its accuracy. Guerdon Associates assumes no liability for the use or interpretation of information contained herein. This publication is provided 'as is' without warranty of any kind, either expressed or implied, including, but not limited to, the implied warranties of marketability, fitness for a particular purpose, or non-infringement of third party rights.

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  Copyright © 2010 Guerdon Associates

ISSN 1834-8300