Wednesday, December 07, 2005

The Big Money

Executive pay makes an interesting story, especially when a company is in trouble. But as you discovered on your Internet hunt, coming up with a figure isn't so easy. That's because bottom line depends on what you decide to include as compensation.

Travis Poling, a business reporter for San Antonio’s Express-News, offers this formula for assessing executive compensation:

Salary + Bonuses + LTIP (long-term investment payouts) + Other Annual compensation + All Other Compensation + Value Realized from Stock Options (profits from company stock CEO's have actuall sold ove the past year.)

You’ll find this information on a report public companies file annually called a “Proxy Statement.” The SEC calls it DEF-14A. The report is usually filed before a company’s annual shareholder’s meeting, and it includes tables with information you can plug into Poling’s formula.

Using Poling's forumla, here’s what I learned about Mary Junck compensation for the latest available year (2004):

Salary -- $ 750,000
Bonus -- $1,080,000
Other-- $ 242,800
Stock Options Sold -- $ 863,900
Total -- $2,261,700

That’s a fair number, though it doesn’t include the value of all Lee stock she’s holds but has yet to sell.

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