BT 2015 Annual Report Download - page 183

181
Overview
The Strategic Report
Purpose and strategy Delivering our strategy Group performance Governance Financial statements
Additional information
6KDUHEDVHGSD\PHQWVFRQWLQXHG
 and  eac ecutive lans
urin 011 1 011 9 011 1 options were eercised nil 011 nil 011 1 options epired and nil
011 nil 011 nil options were forfeited under forer eecutive share option plans  and . There were no options outstanding
at 31 March 2015.
Executive share plans
oveents in eecutive share plan awards durin 011 are shown below
uber of shares illions
ISP DBP Total
At 1 April 2014 70 13 83
Awards granted 16 3 19
Awards vested 0  
Awards lapsed 11 –11
Dividend shares reinvested 2 – 2
$W0DUFK 57 11 68
Fair values
The following table summarises the fair values and key assumptions used for valuing grants made under the Employee Saveshare plans and ISP in
011 011 and 011.
2015 2014 2013
Year ended 31 March
Employee
Saveshare ISP
Employee
Saveshare ISP
Employee
Saveshare ISP
Weighted average fair value 82p 309p 61p 269p 43p 170p
Weighted average share price 387p 393p 310p 315p 209p 204p
Weighted average exercise price 326p na 257p na 176p na
Expected dividend yield 3.5% – 3.8% na 3.9% – 5.6% na 3.6% – 5.2% na
Risk free rates 1.2% – 2.0% 1.2% 0.7% – 1.5% 0.7% 0.3% – 0.8% 0.4%
Expected volatility 22.2% – 24.9% 24.3% 23.3% – 31.9% 32.0% 28.1% – 36.5% 33.6%
Employee Saveshare grants are valued using a Binomial options pricing model. Awards under the ISP are valued using Monte Carlo simulations. TSRs
are generated for BT and the comparator group at the end of the three-year performance period, using each company’s volatility and dividend yield,
as well as the cross correlation between pairs of stocks.
olatilit has been deterined b reference to s historical volatilit which is epected to reect the  share price in the future. n epected life of
three months after vesting date is assumed for Employee Saveshare options and for all other awards the expected life is equal to the vesting period.
he ris-free interest rate is based on the UK ilt curve in eect at the tie of the rant for the epected life of the option or award.
The fair values for the DBP were determined using the market price of the shares at the date of grant. The weighted average share price for DBP
awards ranted in 011 was 9p 011 1p 011 0p.