5.21 Obtain the remuneration report for a publicly listed company. Examine the compensation contract for the chief executive officer (CEO). Prepare a report which summarises your findings relating to the following issues:

(a) What amount is short term in nature (salary and cash bonus) and what is based on longterm entity or managerial performance?

(b) What proportion of the CEO's pay is performance based and what proportion is not?

(c) What measures of accounting performance are used to determine the CEO's bonus?

(d) Given the accounting entity performance measures in the contract, what accounting decisions could the CEO make in order to maximise his or her bonus?

(e) Can agency theory provide an explanation for the various remuneration components? Justify your answer

5.24

A clothing manufacturer has decided to close its factory in a regional Australian town and move its operations offshore to a country where they can employ workers at a substantially reduced cost. Closing the factory will result in the loss of 400 jobs in the town. Outline the issues the clothing manufacturer might face with regards to its implied social contract. You should identify what groups or people are likely to be concerned or affected by the decision and whether the decision is likely to be seen as advantageous or disadvantageous to these groups. You should also discuss actions the clothing manufacturer could take to reduce any potential negative reaction to the decision.

5.28

Pick an organisation you are familiar with. List three important classes of participants in this organisation. Identify the resources that each contributes to and receives from the organisation. Explain the relationship of each of these classes of participants from both an agency theory and a stakeholder theory perspective.