Qantas 2011 Annual Report Download - page 84

THE QANTAS GROUP 82
for the year ended 30 June 2011
Notes to the Financial Statements continued
During the year ,, Rights were granted, of which ,, Rights were granted on  August  and ,, Rights were granted
on  October  (: ,, Rights were granted on  September ). All Rights were granted with a nil exercise price. No amount
has been paid, or is payable by the Executive in relation to these Rights.
Performance hurdles in relation to the outstanding Rights at  June  were tested subsequent to  June . As a result, , Rights
will lapse from the / award and ,, Rights will lapse from the / award in / (: , Rights from the
/ award will lapse in /).
During the year , Rights were exercised (: ,).
At  June , , Rights are available to be exercised at the request of the Executive under the / award, , Rights under
the / award and a further , Rights under the / award (: , Rights under the / award, , Rights
under / award and , Rights under the / award). For more information on the operation of the LTIP, see page .
FAIR VALUE CALCULATION
The estimated value of Rights granted with the TSR performance hurdle component was determined at grant date using a Monte Carlo model.
A Black Scholes model was used to value the Rights with the EPS performance hurdle. The weighted average fair value of Rights granted
during the year was $. (: $.).
 
Inputs into the Models
 October

 August

 September

Weighted average share value $. $. $.
Expected volatility % % %
Dividend yield .% .% .%
Risk-free interest rate .% .% .%
The expected volatility for the / award was determined having regard to the historical one year volatility of Qantas shares and the
implied volatility on exchange traded options. The risk-free rate was the yield on an Australian Government bond at the grant date matching
the remaining life of the plan. The yield is converted into a continuously compounded rate in the model. The expected life assumes immediate
exercise after vesting.
B SHORT TERM INCENTIVE PLAN STIP
The following awards were made under the STIP during the year ended  June :
 
Shares Granted Number of Shares
Weighted Average
Fair Value
$Number of Shares
Weighted Average
Fair Value
$
Performance shares granted –  August  ,, . – –
Shares are valued based on the volume weighted average price of Qantas shares as traded on the ASX for the seven calendar days up to
and including the date of allocation. Expected dividends are not specically taken into account when calculating the fair value but are implicit
in the weighted average price of Qantas shares. Shares are issued or purchased on-market and are held subject to a restriction period.
For further detail on the operation of the STIP, see page .
C PERFORMANCE SHARE PLAN PSP
There were no awards made under the PSP during the year ended  June  (: ,, shares were granted on  August  at a
weighted average fair value of $. per share).
Shares are valued based on the volume weighted average price of Qantas shares as traded on the ASX for the seven calendar days up to
and including the date of allocation. Expected dividends are not specically taken into account when calculating the fair value but are implicit
in the weighted average price of Qantas shares. Shares are issued or purchased on-market and are held subject to a holding lock. For further
detail on the operation of the PSP, see page .
24. Share-based Payments continued