>> Accounting Basics
Accounting and Society
In their annual report, companies are required to include a remuneration report that documents the remuneration packages of the chief executive officer, other key executives and the directors. There has been considerable media attention on the rapidly increasing remuneration packages provided to chief executive officers in Australia over the last decade. The government response to concerns over the size and structure of remuneration packages was the introduction of the two-strike rule to the Corporations Act (2001).
Assume you are employed as an accountant at an Australian publicly listed company. The chief financial officer has asked you to prepare a report which addresses the following:
1. Briefly explains the types of compensation included in remuneration packages of Chief Executive Officers and provides examples from the latest remuneration report for your allocated* Australian publicly listed company.
2. Briefly explains the two-strike rule.
3. Critically evaluates from the shareholders' perspective, the size and structure of chief executive remuneration and the potential impact of the two-strike rule, using
i) Agency theory and
ii) Either legitimacy theory, institutional theory or stakeholder theory.
This evaluation should include reference to two theories only (no additional marks are available for students who choose to use more than two theories). It is not expected that part 3 of this task will be specifically related to your allocated company although you may refer to this company if you wish.
*You will be emailed your allocated company.
Please note: You must submit a copy of the remuneration report of your allocated publicly listed company with your assignment. One (1) mark out of a possible 20 marks will be deducted if you do not submit the remuneration report.
- You are expected to undertake research in order to complete this task.
- Please refer to the rubric to assist you in meeting the requirements of this task.
- You may include sub-headings in your report and an executive summary (abstract) is required.