On January 1, 2018, Hay Ltd. issued 180,000 share appreciation rights (SARs) to its executives. The SARs plan gave each executive the right to receive cash at any time between December 31, 2019, and December 31, 2020, equal to the difference between the market price of Hay Ltd.s common shares and $16. Market prices of the common shares were as follows:

December 31, 2019	$19 per share
December 31, 2020	$20 per share

The vesting period was from January 1, 2018, to December 30, 2019. The fair values of the SARs were as follows:

December 31, 2018	$3.20 per share
December 31, 2019	$4.45 per share

On December 31, 2019, 40,000 SARs were exercised. The remaining SARs were exercised on December 31, 2020.

Hay Ltd. prepares its financial statements using IFRS.

Required:

1. Prepare a reconciliation showing all changes in the SAR liability account from January 1, 2018, to December 31, 2020. Clearly label offsetting accounts. (Hint: use a T-account).
2. Identify two other types of share-based compensation (other than cash-settled SARs) that a company may choose to offer. Explain the general objective of offering share-based compensation.