Table of ContentsSummary 31.0 Introduction 41.1 How do different accounting theories relate to real-world scenarios? 51.2 Bonus Plan Assumptions and Executive Compensation 62.0 Company Overview with Compensation Plans 72.1 Telstra Corporation Limited 72.2 Harvey Norman Holdings Limited 72.3 Compensation Plan and Contract Costs 83.0 Corporate Amendments and Say on Pay 93.1 Global Corporate Developments cooperation amendments 113.2 Pay-for-performance link and “First Strike” 113.3 Pay-for-performance link and “Second Strike” 114.0 Conclusion 12Bibliography 13Executive summaryThis report is based on the links between pay and performance, and on the question to know whether the respective components of remuneration could be used to align the interests of managers and also minimize the contractual costs of the organization. We took examples of annual reports from 2 different companies and identified various incentives given to their respective executives. Additionally, we generally discussed the impact of “Say on Pay” and “Two Strikes” on businesses. Global developments in corporate changes and financial legislation have also been identified.1.0 IntroductionIn this highly competitive and complex business world, executive compensation and shareholder influence on decision making have been controversial. This issue has been particularly high profile since the start of the global financial crisis in 2008. These reasons have led many countries to introduce new financial and corporate amendments to restrict excessive compensation of CEOs and senior executives. The changes include corporate changes that...... middle of paper ...... from Management Journal, vol.57, no.1, pp.94-115.Mangen, C & Mangen, M 2012, '"Say on Pay": A Wolf in Sheep's Clothing?', Academy of Management Perspective, May 1, accessed April 20, 2014, Muir, J 2014, "Theme 6: Positive Accounting Theory", ACC30001/ACC30008 Accounting Theory, learning material on Blackboard, Swinburne University of Technology, April 9, accessed April 19, 2014. Shin, J, Y & Seo, J 2010, “Less Pay and More Sensitivity? Corporation Limited 2013, www.aspecthuntley.com.au, accessed April 21 2014,