Siemens 2012 Annual Report Download - page 299

135 D. Consolidated Financial Statements 239 E. Additional Information
140 D. Consolidated Statements of Changes in Equity
142 D. Notes to Consolidated Financial Statements
232 D. Supervisory Board and Managing Board
136 D. Consolidated Statements of Income
137 D. Consolidated Statements of Comprehensive Income
138 D. Consolidated Statements of Financial Position
139 D. Consolidated Statements of Cash Flow

Compensation expense related to Bonus Awards is generally
recognized over the vesting period of one year. Beneficiaries
will receive one Siemens share without payment of consider-
ation for each Bonus Award, following an additional waiting
period of four years.
In fiscal , the Company granted additional , stock
awards to members of the Managing Board. The fair value of
these stock awards amounting to €. per stock award was
determined as the market price of Siemens shares less the
present value of expected dividends.
The remuneration system of the Managing Board and the
changes in the stock awards held by Managing Board mem-
bers are explained in detail in the Compensation report within
the Corporate Governance report.
Commitments to members of the senior
management and o ther eligible employees:
In fiscal , ,, stock awards were granted to mem-
bers of the senior management and other eligible employees
contingent upon attainment of an EPS target. The fair value of
these stock awards amounts to € million and corresponds to
the target amount reflecting the EPS target attainment. In fis-
cal , , stock awards were granted to members of
the senior management and other eligible employees contin-
gent upon the attainment of a prospective performance-based
target of the Siemens stock. The fair value of these stock
awards amounting to € million, of which € million relate
to equity instruments, was calculated by applying a local vola-
tility model. Inputs to that model include an expected weight-
ed volatility of Siemens shares of .% and a market price of
€. per Siemens share. Expected volatility was determined
by reference to implied volatilities. The model applies a risk-
free interest rate of up to .% and an expected dividend yield
of .%. Compensation expense related to these stock awards
is recognized over four years until they vest.
In fiscal , fair value was determined as the market price of
Siemens shares less the present value of dividends expected
during the four year and three year vesting period, respective-
ly, as stock awards do not carry dividend rights during the
vesting period. The weighted average grant-date fair value for
board members, senior management and other eligible em-
ployees amounts to €. per stock award granted in fiscal
, resulting in a total fair value of stock awards granted in
fiscal  of € million.
The following table shows the changes in the stock awards
held by members of the senior management and other eligible
employees:
Year ended September ,
 
Awards Awards
Non-vested, beginning of period 3,857,315 4,322,824
Granted 2,028,554 1,249,901
Vested and transferred (1,531,944) (1,482,096)
Forfeited/settled (136,337) 1 (233,314)
Non-vested, end of period 4,217,588 3,857,315
1 Consists of , forfeited and , settled awards, respectively, in fiscal .
  
   :
. Share Matching Plan
In fiscal  and , the Company issued a new tranche un-
der the Share Matching Plan. Senior managers of Siemens AG
and participating Siemens companies may invest a specified
percentage of their compensation in Siemens shares; in fiscal
, members of the Managing Board, for the last time, could
invest a specified amount of their bonus payout relating to fis-
cal  in Siemens shares. Within a predetermined period in
the first quarter of each fiscal year, plan participants decide on
their investment amount for which investment shares are pur-
chased. The shares are purchased at the market price at a pre-
determined date in the second quarter. Plan participants re-
ceive the right to one Siemens share without payment of con-
sideration (matching share) for every three investment shares
continuously held over a period of three years (vesting period)
provided the plan participant has been continuously employed
by Siemens AG or another Siemens company until the end of
the vesting period. During the vesting period, matching shares
are not entitled to dividends. The right to receive matching
shares forfeits if the underlying investment shares are trans-
ferred, sold, pledged or otherwise encumbered. Matching
shares may be settled in newly issued shares of common stock
of Siemens AG, treasury stock or in cash. The settlement meth-
od will be determined by the Managing Board. Each fiscal year,
the Company decides whether or not to issue a new tranche
under the Share Matching Plan.
. Monthly Investment Plan
In fiscal  and , the Company issued a new tranche un-
der the Monthly Investment Plan that is a further component
of the Share Matching Plan and which is available for employ-
ees – other than senior managers – of Siemens AG and partici-
pating Siemens companies. Plan participants may invest a
specified percentage of their compensation in Siemens shares