Managerial Accounting Company Reviews and Performance Measures

This presentation provides an analysis of the remuneration committee and its membership, allocation of executive remuneration, mix of performance measures used, company performance versus executive pay, summary of findings, and conclusion of Mayne Pharma and CSL Limited.

MANAGERIAL
ACCOUNTING
Name of the Student:
Name of the University:
Author’s Note:
Course ID:

Company reviews:
Details of remuneration committee
and its membership:
•No evidences could be found about the
members of the remuneration committee,
while CSL Limited has three independent
non-executive directors in its remuneration
committee.
•Timely meetings in a particular accounting
year by taking into consideration external
and internal conditions.

Company reviews
(Continued):
Allocation of executive remuneration:
• In case of Mayne Pharma, fixed remuneration relies on the
scope of executive role and their individual knowledge, skill
and experience. In case of CSL, fixed remuneration
includes base pay and superannuation reviewed annually
and benchmark is set against comparable peer entities.
•STIs rely on the results of the yearly corporate scorecard
and individual performance in opposition to knowledge
performance indicators.
•LTIs are developed for aligning the executive as well as
employee performance with the shareholders’ interest.

3. Company reviews
(Continued):
3.3 Mix of performance measures
used:
• In case of Mayne Pharma, the earnings
per share of the organisation have
increased from 4.77 cents in 2016 to 6.18
cents in 2017, while the same has been
$2.689 in 2016 compared to $2.937 in
2017.
• However, for CSL Limited, the return on
investment has fallen from 26.8% in 2016
to 24.5% in 2017. On the other hand, for
Mayne Pharma, the return on capital
invested has increased from 30% in 2016
to 32.60% in 2017.

3. Company reviews
(Continued):
3.3 Mix of performance measures used
(Continued):
• Non-financial measure (Balanced scorecard):
Financial perspective:
• Mayne Pharma has the goal of minimising its business
expenditures. This is accomplished by enhancing
productivity along with optimising business processes.
Customer perspective:
• Mayne Pharma has developed a long-term plan for
ensuring that adequate customers are generated to
arrive at positive financial performance.
Internal processes perspective:
• After the customer requirements are identified, Mayne
Pharma is engaged in cross-selling products due to the
presence of proactive staffs.
Learning and growth perspective:
• Balanced scorecard is utilised for providing excess motivation
to the staffs so that positive work outcomes could be assured.

3. Company reviews
(Continued):
3.4 Company performance versus
executive pay:
• The share price of the organisation has been on
the increasing scale and the current share price
stands at $1.22.
• After analysing the staff performance, Mayne
Pharma has provided certain benefits in the form of
short-term incentives and long-term incentives to its
executive and non-executive members.

4. SUMMARY OF
FINDINGS:
• Mayne Pharma and CSL Limited conduct timely
meetings in a particular accounting year by taking
into consideration external and internal conditions.
• Mayne Pharma has the goal of minimising its
business expenditures. This is accomplished by
enhancing productivity along with optimising
business processes. For accomplishing the same,
the organisation has formulated a five-year plan and
the implementation process is carried out in distinct
steps.

5. CONCLUSION:
• Mayne Pharma and ASL Limited have developed
remuneration committees for reviewing and
recommending the executive compensation of the
board committees.
• However, in terms of financial performance in
share market, Mayne Pharma is enjoying
competitive advantage over CSL Limited and thus, it
has increased its executive remuneration
accordingly.

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