Goldman Sachs 2007 Annual Report Download - page 129

Download and view the complete annual report

Please find page 129 of the 2007 Goldman Sachs annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 154

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154

Notes to Consolidated Financial Statements
Other Compensation Arrangements
The firm has deferred compensation plans for eligible employees.
In general, under the plans, participants are able to defer
payment of a portion of their cash year-end compensation.
During the deferral period, participants are able to nominally
invest their deferrals in certain alternatives available under the
plans. Generally, under current tax law, participants are not
subject to income tax on amounts deferred or on any notional
investment earnings until the returns are distributed, and
the firm is not entitled to a corresponding tax deduction
until the amounts are distributed. The firm has recognized
compensation expense for the amounts deferred under these
plans. As of November 2007 and November 2006, $281 million
and $245 million, respectively, related to these plans was
included in “Other liabilities and accrued expenses” in the
consolidated statements of financial condition.
The firm has a discount stock program through which eligible
senior executives may acquire restricted stock units at an effective
25% discount. The 25% discount is effected by an additional
grant of restricted stock units equal to one-third of the number
of restricted stock units purchased by qualifying participants.
The purchased restricted stock units are 100% vested when
granted, but the shares underlying them are not able to be sold
or transferred (other than to satisfy tax obligations) before the
third anniversary of the grant date. The shares underlying the
restricted stock units that are granted in order to effect the
25% discount will generally vest in equal installments on the
second and third anniversaries following the grant date and
will not be transferable before the third anniversary of the
grant date. Compensation expense related to these restricted
stock units is recognized over the vesting period. The total
value of restricted stock units granted in 2007 and 2006
in order to effect the 25% discount was $66 million and
$72 million, respectively.
NOTE 12
Employee Incentive Plans
Stock Incentive Plan
The firm sponsors a stock incentive plan, The Goldman Sachs
Amended and Restated Stock Incentive Plan (the Amended
SIP), which provides for grants of incentive stock options,
nonqualified stock options, stock appreciation rights, dividend
equivalent rights, restricted stock, restricted stock units, awards
with performance conditions and other share-based awards. In
the second quarter of 2003, the Amended SIP was approved by
the firm’s shareholders, effective for grants after April 1, 2003.
The total number of shares of common stock that may be
issued under the Amended SIP through 2008 may not exceed
250 million shares and, in each year thereafter, may not exceed
5% of the issued and outstanding shares of common stock,
determined as of the last day of the immediately preceding
year, increased by the number of shares available for awards
in previous years but not covered by awards granted in such
years. As of November 2007 and November 2006, 160.6 million
and 180.0 million shares, respectively, were available for grant
under the Amended SIP.
127Goldman Sachs 2007 Annual Report