Welcome to the August 2013 issue of GuerdonNews®

In this month's issue we:

• Describe Treasury proposals to encourage the granting of equity in “start-up” companies
• Note that the government still intends additional remuneration disclosure regulation despite shelving it for this year
• Clarify new FBT rules on cars
• Provide a checklist to assess your board skills matrix
• Report a court ruling that determined when an employee share option should have been valued for tax purposes
• Note relief will be temporarily available for superannuation fund director and executive remuneration disclosure
• Describe new clawback and malus requirements designed to change UK banking culture

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

Australian government proposes changes to tax of share plans for ‘start-ups’

At best it may assist companies to the stage where they seek their next round of funding (and residency) offshore

The Government has released a discussion paper as the first step in a review of the tax treatment of employee share schemes (ESSs) for ‘start up’ companies, with the aim of encouraging such schemes and promoting growth.

The review recognises the significant complexities and compliance burden of the existing regime, and its adverse impact on speculative, start-up and R&D companies.

Unfortunately, the narrow definition of ‘start-up’ company proposed by the government would seriously limit the benefits of any changes.

New rules for FBT on cars announced by Government

We provide a checklist

The government’s changes to the FBT treatment of employer-provided and salary-sacrificed motor vehicles have received a lot of media attention since they were announced on 16 July 2013. But what, exactly, has happened, and what are the implications?

Effective board skills matrices

A checklist

The board skills matrix is a widely used tool to provide a ‘master plan’ for the recruitment and development of directors and board succession planning. However, a significant proportion could be described as little more than a ‘motherhood statement’ and of limited utility. With some proxy advisers now seeking more disclosure on board skills and succession plans, lifting the standard of board skill assessment would also position a company well with investors.

More than this, skills matrices offer a real opportunity to lift board and company performance to higher and sustainable levels. Skills matrices interact with board and director evaluation, director development and board renewal processes that enable improvement and change.

We have designed a checklist to assist companies assess the usefulness of their board skills matrices, along with some suggestions for improvement.

Another take on when options are granted under an employee share scheme

This is important because that is when the taxable value is determined

The question of when options are acquired under an employee share scheme has again been considered by the Full Court of the Federal Court of Australia.

The issue was whether the taxpayer acquired the options when the board resolved to grant them, subject to shareholder approval, or whether he only acquired the options after shareholders approved the grant at the AGM.

Disclosure of superannuation fund director and executive officer remuneration

Superannuation trustees had 2 days to absorb the law before it became effective.

From 1 July 2013, superannuation fund trustees must disclose the remuneration of each director or other executive officer if the RSE licensee is a body corporate, or each trustee if the RSE licensee is a group of individual trustees. Trustees need to disclose all payments, benefits and compensation paid for or provided by the trustee or by related bodies corporate.

Superannuation trustees had 2 days to absorb it before it became effective. However, it had been under consideration for months.

Nevertheless, given the short notice, ASIC has allowed superannuation funds a longer period to adjust with a special class order exemption.

Australian government still plans additional disclosure regulation

But they could be quite different to the original proposal

The current government has indicated that it will proceed with its plans to regulate remuneration disclosure, despite the revelation first made public by Guerdon Associates that the government had shelved its original plans to have new reporting requirements in effect from now.

New UK banker clawback and malus requirements to be introduced

The UK government has responded to the Parliamentary Commission on Banking Standard’s (PCBS) report, ‘Changing banking for good’

The UK government has responded to the Parliamentary Commission on Banking Standard’s (PCBS) report, ‘Changing banking for good’ by announcing that it intends to strengthen standards.

This is an additional UK law not required by the EU to coincide with the UK government, a Tory coalition, starting up its own bank.

Latest GuerdonData® Updates

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

Macquarie Altas Roads Limited, Bathurst Resources New Zealand Limited

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

“The UK's new executive pay rules”, The Boardroom Report, Volume 11, Issue 14, 24 July 2013