Telstra 2005 Annual Report Download - page 45

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Short term incentive for 2005
With the exception of Dr Switkowski and Mr Scales, the values of the actual
STI payment shown in figure 12 represent the 50% cash component. The
remaining 50% of the STI payment will be provided as rights to Telstra
shares through the annual STI equity plan. In accordance with the
accounting standards the value of the STI equity will be amortised over
the next three years following allocation. Figure 13 provides the full value,
both cash and equity, which executives received through the STI plan in
fiscal 2005.
Name Maximum potential Actual STI (2) % of the maximum
STI (1) – both cash and – both cash and potential (3)
equity components equity components
($) ($)
Zygmunt E Switkowski 3,764,000 1,961,000 52.1%
Bruce Akhurst (4) 1,479,600 1,047,200 70.8%
Douglas Campbell 1,353,600 621,200 45.9%
David Moffatt 1,504,800 496,600 33.0%
Ted Pretty 1,504,800 1,081,000 71.8%
Michael Rocca 1,177,200 833,200 70.8%
Bill Scales 622,800 428,700 68.8%
Deena Shiff (5) 819,000 590,300 72.1%
John Stanhope 709,200 480,300 67.7%
David Thodey 1,364,400 412,400 30.2%
(1) The Board may determine the minimum value of the short term incentive to be $nil where the performance fails to meet the specified threshold levels.
(2) Short-term incentive relates to performance for the year ended 30 June 2005 and is based on actual performance for Telstra and the individual. Payment is provided in the form of
50% cash and 50% as rights to Telstra shares in accordance with the 2005 STI Equity plan. STI payments to Dr Switkowski and Mr Scales will be paid as cash only as their employment
relationship with Telstra will cease prior to the allocation of equity.
(3) Where the actual STI payment is less than the maximum potential, the difference is forfeited and does not become payable in subsequent years.
(4) Mr Akhurst was appointed to the role of CEO Sensis effective 1 January 2005, but is still regarded as Group Managing Director level for remuneration purposes.
(5) Ms Shiff was appointed to the role of Group Managing Director, Wholesale effective 1 January 2005.
Figure 13: STI for fiscal 2005
Long term incentive valuations
The following table provides the amortised accounting value of all LTI
equity instruments. This includes allocations made in fiscal 2001, 2002,
2003, 2004 and 2005. Although these values appear in figure 14, apart from
the September 2001 plan, the executives have not derived any value from
these instruments as at 30 June 2005.
During fiscal 2005 the restricted shares and options allocated in fiscal 2000
lapsed as the performance measure was not satisfied during the
performance period. As a result, the value attributed to these instruments
only reflects the notional value until 13 September 2004 when they lapsed.
Half of the performance rights and options allocated under the September
2001 plan lapsed because the performance measure was not met during
the first quarter of the performance period. The minimum performance
measure was achieved in a subsequent quarter and the remaining
allocations of performance rights and options vested to the participants.
Allocations for fiscal 2002, 2003, 2004 and 2005 are also subject to
performance measures and therefore the CEO and senior executives
may or may not derive value from the allocations.