News & Information

 

FEATURED PRODUCT

5500 Preparer's Manual for 2012 Plan Years
The premier resource in the field of Form 5500 preparation, 5500 Preparer's Manual will help you handle the required annual Form 5500 filings for both pension benefits and welfare benefit plans.

Learn More »

CCH® PENSION AND BENEFITS — 9/25/06

SEC rules are designed to improve disclosure to investors

The Securities and Exchange Commission (SEC) recently issued massive rule changes requiring disclosure of executive and director compensation that is more comprehensive and understandable (see CCH Pension Plan Guide ¶16,567R). The broad purpose of the new regime, as explained in a CCH Comment, is to improve disclosure by including all elements of executive and director compensation. Chairman Christopher Cox has noted that the SEC hopes to improve the total mix of information available in the marketplace to help investors, shareholders, and board compensation committees assess the information themselves and reach their own conclusions. 

Under this broad policy, the goal of the executive and director compensation disclosure regime is to provide investors with clearer, better organized and more complete disclosure regarding the mix, size and incentive components of executive and director compensation. This goal would be accomplished by eliminating some tables and other disclosures that may no longer be useful to investors, revising other tables so that they are more informative, and requiring new tabular and new quantitative estimate disclosure for retirement plans and similar benefits and director compensation. 

The SEC rules require enhanced narrative disclosure, in the form of a Compensation Discussion and Analysis section, and narrative disclosure accompanying the tables, to explain the significant factors underlying the compensation decisions reflected in the tabular data. The rules require companies to report the total amount of compensation for named executive officers and directors, and provide important context to the disclosure of total compensation.

For more information on this and related topics, consult the CCH Pension Plan Guide.

Visit our News Library to read more news stories.