Unilever 2003 Annual Report Download - page 119

116 Unilever Annual Report & Accounts and Form 20-F 2003
Notes to the consolidated accounts
Unilever Group
28 Analysis of net funds/(debt)
€ million € million € million € million € million € million
Acquisitions/
disposals Other
1 January Cash (excl. cash & non-cash Currency 31 December
2003 flow overdrafts) changes movements 2003
Cash on call and in hand 1 028 (785) 1 061 1 304
Overdrafts (277) (61) 18 (320)
(846)
Borrowings due within one year (8 660) 3 310 (20) (1 507) (237) (7 114)
Borrowings due after one year (10 933) (401) – 1 968 900 (8 466)
2 909
Current investments 1 226 89 (3) 229 (50) 1 491
Cash on deposit 650 (48) – – (52) 550
41
Net funds/(debt) (16 966) 2 104 (23) 690 1 640 (12 555)
Other non-cash changes include profits and losses on disposal and adjustments to realisable value of current investments; exchange gains and
losses on inter-company borrowings and related derivatives; and the reclassification of long-term borrowings falling due within one year at the
balance sheet date.
Balances at 1 January 2003 have been restated following a change in accounting policy for the presentation of securities received as collateral
in connection with derivative financial instruments. See note 14 on page 94.
29 Equity-based compensation plans
As at 31 December 2003, the Group had a number of equity-based compensation plans:
(i) All-Employee Option Plans
Local All-Employee Option Plans have been set up in 16 countries to enhance employee involvement with Unilever and its performance by
providing a potential financial benefit linked to the Unilever share price. There are no individual performance targets to be met. The plans
permit participation by all permanent employees in the country where the relevant plan applies.
(ii) Executive Option Plans
The Executive Option Plans were introduced in 1985 to reward key employees throughout the world for their contribution to the enhancement
of the Group’s longer-term future and their commitment to the Group over a sustained period. The grant is dependent on performance of the
Group and the individual.
(iii) The Share Matching Plans
If managers invest part of their annual bonus in Unilever shares, the company will match this with the same number of shares on the condition
that they keep all shares for an agreed number of years and will still be employed by Unilever on the vesting date.
(iv) The TSR Long-Term Incentive Plan
This plan was introduced in 2001 and, depending on the TSR ranking (see page 20) of Unilever in comparison with its peer group, it will
potentially award top executives on the vesting date three years later with between 0% and 200% of the original conditional award.
(v) The Restricted Share Plan
Restricted shares are awarded to a select number of executives for special performance. After the agreed number of years the awards will vest
provided the executives are still employed by Unilever at that time.
(vi) The North American Performance Share Plan
A long-term incentive plan for North American managers, awarding Unilever shares if company and personal performance targets are met over
a three-year period.
Unilever will not grant share options in total in respect of Executive Option Plans for more than 5% of its issued ordinary capital, and for all
Plans together, for more than 10% of its issued ordinary capital. The Board does not apportion these limits to each plan separately.
In recent years we have met the obligations under our share option and award plans by purchasing shares in advance and transferring them,
in return for the exercise price, to Directors and employees as the options are exercised.