Page 730 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

Glossary 715

ROTC See return on capital employed.
Roth IRA A nondeductible IRA permitting a limited annual contribution whose investment accumu-
lates tax free.
Rule 10b5–1 See Section 10b5–1.
Rule of 72 A rough guide to determine time or interest rate required to double one’s investment as
long as one of the factors is known (it is divided into 72 to determine the unknown value).
Rule 13D Disclosure of stock holdings on a Schedule 13D filing to the SEC of holders of more than
5 percent of a company’s stock.
Rule 144 Holding requirements of acquired stock for shares not registered with the SEC and that
owned by persons who control the company.
Rule 145 Holding and reporting requirements resulting from sale of company stock due to acquisi-
tions, mergers, or other stockholder-approved reorganizations.
Rule 431 New York Stock Exchange requirement that an investor maintain at least a 25 percent
equity position on margin accounts.
rulemaker Regulatory body such as the IRS, FASB, and SEC that prescribes what can and cannot be
done in certain situations.
run rate The number of shares of stock granted annually under option (or award) as a percentage of
the total shares outstanding. See also burn rate.
Russell 2000 An index of 2000 small-cap stocks listed on NASDAQ.

S1 See Form S1.
S3 See Form S3.
S4 See Form S4.
S5 See Form S5.
sabbatical A leave of absence of six months or longer (typically with pay).
safe harbor provision An interpretation of a law or ruling that if met will be viewed as being in
compliance.
salaried A person paid by the week, month, or year instead of by the hour.
salary The base pay element on which benefits, perquisites, and incentives (short and long term) are
based. It may be increased but is rarely reduced.
salary continuation plan Continuation of salary during disability or other approved absence
with pay.
salary grade See job grade.
salary range The difference between the low and high or minimum and maximum, either actual or
structural.
salary reduction plan Set aside for use in pretax (if tax qualified) or after-tax plan.
salary structure Pay ranges for hierarchy of job grades.
salary survey Determination of what other companies are paying for a particular job, typically
through a questionnaire.
sales See revenue.
sales-cash ratio Sales divided by cash, indicating the extent to which sales have not been converted
into a cash balance.
sales-inventory ratio Sales divided by inventory, indicating efficient use of assets.
sales per employee Net sales divided by the number of employees in the unit.