16. EMPLOYEE BENEFITS
16.1 INCENTIVE BONUSES
GROUP
2020
R’m
2019
R’m
Balance at the beginning of the year 26 47
Increase in provision during the year 24 26
(Over)/under-provision previous year (1) 2
Utilised during the year (25) (49)
Balance at the end of the year 24 26
The group has a short-term incentive scheme for employees and an equity-settled share-based payment scheme for senior
management. It is aligned with the objectives and remuneration philosophy of the group in that a portion of the remuneration
is subject to risk. A provision is created in accordance with the rules of the schemes.
16.1.1 Short-term incentive scheme
The short-term incentive scheme is paid each year to qualifying employees. The calculation is based on the performance
of the group, the division in which the employee is employed as well as an individual evaluation of the
performance of the employee.
16.2 EQUITY-SETTLED SHARE-BASED PAYMENT SCHEME
Senwes grants shares to its senior management. These shares are acquired and held in a trust for the last three years of
the vesting period. The scheme is a forfeitable share award scheme, where shares are forfeited if future service and performance
conditions are not met.
The fair value of the shares granted are determined by using the market value of the shares on grant date adjusted with
the present value of dividends not entitled to. The grant date is the date on which the entity and the participant agree to
a share-based payment arrangement.
The total group expense recognised for the year amounts to R17 million (2019: R9 million). The accumulated equity-settled
reserve amounts to R47 million (2019: R54 million). Refer to the tabel below for more details.
GROUP
2020
R’m
2019
R’m
Opening balance 54 53
Vested during the year (24) (8)
Expense recognised 17 9
Initial shares granted 5 7
Increase in shares granted/new participants 13 7
Over-provision due to change in vesting conditions - (5)
Forfeited during the year (1) -
Equity-settled share-based payment expense 47 54
51
SENWESBEL ANNUAL FINANCIAL STATEMENTS 2020 Senwesbel Limited Reg no: 1996/017629/06