LISI 2012 FINANCIAL REPORT
65
3
Consolidated financial statements
2.7.2 Share-based payments
2.7.2.1 SHARE PURCHASE OPTIONS
Stock options are awarded to directors and certain employees
of theGroup. In accordancewith IFRS 2, “Share-Based Payment”,
these instruments result in the provision of shareholders’
equity instruments and are measured at grant date. The Group
uses the binomial method to measure them.
2.7.2.2 AWARD OF PERFORMANCE SHARES
Acting on the recommendation of the Compensation
Committee, LISI's Board of Directors decided, on July 28, 2010,
to allocate performance shares to members of the Executive
Committee and to members of the principle Management
Committees for the three LISI Group divisions, subject to their
meeting certain performance targets: the achievement of
these two criteria at the end of 2011, namely EBIT and sales
revenue, resulted in the completion of 85% of that plan in 2012.
The final cost was allocated to the divisions.
Acting on the recommendation of the Compensation
Committee, LISI's Board of Directors decided, on June 26, 2011,
to allocate performance shares to members of the Executive
Committee and to members of the main Management
Committees for the three LISI Group divisions, subject to their
meeting certain performance targets. The same went in 2012,
insofar as the Board of Directors of October 24, 2012 renewed
the opening of a new plan under similar conditions.
The fair value of these benefits has been calculated by
independent actuaries and is recognized in the income
statement on a straight-line basis throughout the entitlement
acquisition period.
The fair value of the benefits thus granted is recognized in 2012
in Payroll expenses for €1.5m for the employees of the French
companies, against shareholders' equity, and for €0.5m for the
employees of foreign companies, against Social liabilities. This
cost was not allocated to divisions, and remains an expense at
the LISI S.A. level until the definitive realization of the plan.
2.7.3 Related-party information / Remuneration of
members of management bodies
2.7.3.1 RELATED-PARTY INFORMATION
Related parties include the parent company, company
managers, directors and board members. There is no other
jointly-owned entity or entity recognized by equity method, or
joint shareholder, or business under joint control or significant
influence with which the LISI Group may have carried out
transactions worthy of investigation.
The only relationship of the Group with its parent company
(CID) is through the capital holding. On the other hand, LISI S.A.
provides support to its subsidiaries in the fields of accounting,
finance, strategy and law.
2.7.3.2 REMUNERATION OF MANAGERS AND DIRECTORS
(in €'000)
Expenses for the period
Liabilities
At 12/31/2012
2012
2011
Gross short-term benefits (salaries, bonuses, etc.)
871
759
Post-employment benefits (IFC)
306
229
306
Other long-term benefits
Termination benefits
Equity compensation benefits
63
43
63
Total compensation
1,240
1,030
368
The main directors will receive remuneration in the form of
short-term benefits, post-employment benefits and share-
based payments. With regard to this category, in 2009
and 2010 both directors of LISI S.A. received performance
shares in accordance with the same terms and conditions as
other members of the divisional Executive Committees; Two
additional conditions are also imposed in their case, namely, to
acquire 200 shares at the end of the acquisition period and to
keep a nominative portion of equity (200 shares) until the end
of their function as mandated chief executives of the mother
company.
2.7.4 Commitments
The Group draws up annually a detailed list of all contractual
commitments, financial and commercial commitments, and
contingent liabilities to which LISI S.A. and/or its subsidiaries
are party or exposed. This list is regularly updated by the
departments concerned and reviewed by Group Management.
In order to ensure that the information on this list is complete,
accurate and consistent, special control procedures have been
implemented, including in particular:
• The regular examination of the minutes of Shareholders’
General Meetings, Board Meetings, associated Committees
