Evaluation of Remuneration Structures of Reliance Worldwide and Alcidion Group Limited

Running head: MANAGERIAL ACCOUNTING
Managerial Accounting
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1MANAGERIAL ACCOUNTING
Executive Summary:
The current report aims to evaluate the remuneration structures of two ASX listed
organisations in Australia. For meeting the purpose of this paper, Reliance Worldwide is chosen
as the main organisation and Alcidion Group Limited is selected as its competitor operating in
the health services sector of Australia. Various aspects have been considered in this paper for
assessing the remuneration structure of the two chosen organisations. According to the
remuneration reports of both the organisations, it has been found that the payments of the
executives comprise of fixed payments, short-term incentives and long-term incentives.
Moreover, from the annual reports of both the organisations, it has been found that the
remuneration structures are designed in such a manner that the goals of the directors and
executives are aligned with the objectives of the shareholders and overall business.
However, differences are deemed to be observed in the financial health of the two
organisations. In terms of shareholder return, Reliance Worldwide is in a favourable position in
contrast to Alcidion Group Limited in both 2016 and 2017, as the former has increased its
executive payments in line with the rise in share price and net income. Majority of the annual
incentives constitute of a two-tier structure, in which the first structure is the level of target or the
normal estimated performance of the executives and the second structure is stretch denoting that
the organisation would need to obtain extraordinary outcomes for the maximum incentive
payment. Finally, in terms of short-term and long-term incentives, both organisations have
increased their executive payments, which denote best result for Reliance Worldwide.

2MANAGERIAL ACCOUNTING
Table of Contents
Background:.....................................................................................................................................3
a) Shareholder returns:.....................................................................................................................3
b) Short-term:...................................................................................................................................4
c) Long-term:...................................................................................................................................5
References:......................................................................................................................................7