Taxand USA discusses the requirement of increased CFO involvement with incentive compensation in legislative and regulatory changes.
The stock market gains since the presidential election in early November have signaled optimism for 2017, but the optimism assumes change — maybe a lot. Because of the change anticipated, CFOs will need to be more involved with their companies’ incentive compensation programs in 2017 and beyond.
Probable tax law, healthcare and other regulatory changes in 2017 will make business forecasting, budget planning, and incentive goal setting more difficult than in the past.
Some companies have made use of an umbrella plan for years. Most companies have discretion to adjust payments downward but have not gone the distance to use the full umbrella concept. Because of the high-dynamic environment expected in 2017 and beyond, 2017 may be the year to embrace the umbrella plan concept. For a company that does so, the CFO will need to play an important role in the process.