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ADM to cut CEO’s bonus after accounting scandal hit shares

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Archer-Daniels-Midland Co. plans to slash Chief Executive Officer Juan Luciano’s annual cash bonus and laid out a new policy to claw back long-term awards in a bid to “ensure accountability” more than a year after an accounting scandal sent the commodity-trading giant’s shares tumbling. 

Luciano is due to receive a 2024 bonus of about $1.2 million, less than half of his target of nearly $3 million, according to a securities filing. That brings his total compensation to roughly $21.6 million, down from $24.4 million in the previous year.

The move comes after ADM adjusted years of financial results due to errors in the way it reported transactions between business units. When the company announced the accounting problems in January 2024, the news erased more than $8.8 billion in market value.

ADM’s board determined that it was appropriate to exercise “negative discretion” to shrink the payout percentage for cash incentive awards, the filing stated. The discretion was applied to the company executives “who were in relevant leadership positions during the applicable period.” That’s despite ADM’s conclusion that no executive was found to be engaged in improper conduct. 

Vikram Luthar, the former chief financial officer, will receive zero cash bonus. He resigned in September, before the end of the fiscal year.

In addition, the company laid out a new policy for recouping or forfeiting equity incentive awards, saying it could claw back stock awards if an individual engages in any prohibited conduct, even if his or her employment is not terminated. “Our approach to recoupment of long-term incentive compensation reflects the company’s commitment to protecting stockholder value,” ADM said.

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Accounting

Acting IRS commissioner reportedly replaced

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Gary Shapley, who was named only days ago as the acting commissioner of the Internal Revenue Service, is reportedly being replaced by Deputy Treasury Secretary Michael Faulkender amid a power struggle between Treasury Secretary Scott Bessent and Elon Musk.

The New York Times reported that Bessent was outraged that Shapley was named to head the IRS without his knowledge or approval and complained to President Trump about it. Shapley was installed as acting commissioner on Tuesday, only to be ousted on Friday. He first gained prominence as an IRS Criminal Investigation special agent and whistleblower who testified in 2023 before the House Oversight Committee that then-President Joe Biden’s son Hunter received preferential treatment during a tax-evasion investigation, and he and another special agent had been removed from the investigation after complaining to their supervisors in 2022. He was promoted last month to senior advisor to Bessent and made deputy chief of IRS Criminal Investigation. Shapley is expected to remain now as a senior official at IRS Criminal Investigation, according to the Wall Street Journal. The IRS and the Treasury Department press offices did not immediately respond to requests for comment.

Faulkender was confirmed last month as deputy secretary at the Treasury Department and formerly worked during the first Trump administration at the Treasury on the Paycheck Protection Program before leaving to teach finance at the University of Maryland.

Faulkender will be the fifth head of the IRS this year. Former IRS commissioner Danny Werfel departed in January, on Inauguration Day, after Trump announced in December he planned to name former Congressman Billy Long, R-Missouri, as the next IRS commissioner, even though Werfel’s term wasn’t scheduled to end until November 2027. The Senate has not yet scheduled a confirmation hearing for Long, amid questions from Senate Democrats about his work promoting the Employee Retention Credit and so-called “tribal tax credits.” The job of acting commissioner has since been filled by Douglas O’Donnell, who was deputy commissioner under Werfel. However, O’Donnell abruptly retired as the IRS came under pressure to lay off thousands of employees and share access to confidential taxpayer data. He was replaced by IRS chief operating officer Melanie Krause, who resigned last week after coming under similar pressure to provide taxpayer data to immigration authorities and employees of the Musk-led U.S. DOGE Service. 

Krause had planned to depart later this month under the deferred resignation program at the IRS, under which approximately 22,000 IRS employees have accepted the voluntary buyout offers. But Musk reportedly pushed to have Shapley installed on Tuesday, according to the Times, and he remained working in the commissioner’s office as recently as Friday morning. Meanwhile, plans are underway for further reductions in the IRS workforce of up to 40%, according to the Federal News Network, taking the IRS from approximately 102,000 employees at the beginning of the year to around 60,000 to 70,000 employees.

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Accounting

On the move: EY names San Antonio office MP

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Carr, Riggs & Ingram appoints CFO and chief legal officer; TSCPA hosts accounting bootcamp; and more news from across the profession.

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Accounting

Tech news: Certinia announces spring release

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Certinia announces spring release; Intuit acquires tech and experts from fintech Deserve; Paystand launches feature to navigate tariffs; and other accounting tech news and updates.

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