DEF 14A 1 intu2014-proxy.htm DEF 14A INTU.2014-proxy
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant þ
Filed by a Party other than the Registrant ¨

Check the appropriate box:
¨
 
Preliminary Proxy Statement
¨
 
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
þ
 
Definitive Proxy Statement
¨
 
Definitive Additional Materials
¨
 
Soliciting Material under § 240.14a-12
INTUIT INC.
(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
þ
 
No fee required.
¨
 
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
 
 
(1)
 
Title of each class of securities to which transaction applies:
 
 
(2)
 
Aggregate number of securities to which transaction applies:
 
 
(3)
 
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined):
 
 
(4)
 
Proposed maximum aggregate value of transaction:
 
 
(5)
 
Total fee paid:
¨
 
Fee paid previously with preliminary materials.
¨      Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which
         the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or
         Schedule and the date of its filing.
 
 
(1)
 
Amount Previously Paid:
 
 
(2)
 
Form, Schedule or Registration Statement No.:
 
 
(3)
 
Filing Party:
 
 
(4)
 
Date Filed:



INTUIT INC.
2700 Coast Avenue
Mountain View, CA 94043
NOTICE OF 2015 ANNUAL MEETING OF STOCKHOLDERS
Dear Stockholder:
You are cordially invited to attend our 2015 Annual Meeting of Stockholders, which will be held at 8:00 a.m. Pacific Standard Time on January 22, 2015 at our offices at 2750 Coast Avenue, Building 6, Mountain View, California 94043. We are holding the meeting for the following purposes:
1. To elect the nine directors nominated by the Board of Directors and named in the proxy statement to hold office until the next annual meeting of stockholders or until their respective successors have been elected and qualified;
2. To ratify the selection of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending July 31, 2015;
3. To hold an advisory vote to approve executive compensation;
4. To approve the Amended and Restated Employee Stock Purchase Plan to increase the number of shares of Intuit’s common stock authorized for issuance by 3,000,000 shares; and
5. To consider any other matters that may properly be brought before the annual meeting and any postponement(s) or adjournment(s) thereof.
Only stockholders who owned our stock at the close of business on November 24, 2014 may vote at the annual meeting, or at any adjournment or postponement of the annual meeting.
Your vote is important. Whether or not you plan to attend the annual meeting, please cast your vote, as instructed in the Notice of Internet Availability of Proxy Materials, over the Internet or by telephone, as promptly as possible. You may also request a paper proxy card to submit your vote by mail, if you prefer. We encourage you to vote via the Internet. We believe it is convenient for our stockholders, while significantly lowering the cost of our annual meeting and conserving natural resources.
Important Notice Regarding the Availability of Proxy Materials for Annual Meeting of Stockholders to Be Held on January 22, 2015. The proxy statement is available electronically at http://investors.intuit.com/financial-information/proxy-statements/default.aspx and Intuit’s Annual Report on Form 10-K for fiscal year ended July 31, 2014 is available electronically at http://investors.intuit.com/financial-information/annual-reports/default.aspx.
By order of the Board of Directors,
Laura A. Fennell
Senior Vice President, General Counsel and Corporate
Secretary
Mountain View, California
November 26, 2014



INTUIT INC.
PROXY STATEMENT 2015 ANNUAL MEETING OF STOCKHOLDERS
 
Page










INTUIT INC.
2700 Coast Avenue
Mountain View, CA 94043

PROXY STATEMENT FOR THE
2015 ANNUAL MEETING OF STOCKHOLDERS


2015 PROXY SUMMARY

Intuit Inc.’s (“Intuit” or the “Company”) Board of Directors (the “Board”) is asking for your proxy for use at the Intuit Inc. 2015 Annual Meeting of Stockholders (the “Meeting”) and at any adjournment or postponement of the Meeting for the purposes set forth in the accompanying Notice of 2015 Annual Meeting of Stockholders. This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider, and you should read the entire proxy statement carefully before voting.

Annual Meeting of Stockholders
Time and Date
 
Thursday, January 22, 2015 at 8:00 a.m. Pacific Standard Time
Place
 
Intuit’s offices at 2750 Coast Avenue, Building 6, Mountain View, California 94043
Record Date
 
November 24, 2014
Voting
 
Stockholders of Intuit as of the record date are entitled to vote. Each share of Intuit common stock is entitled to one vote for each director nominee and one vote for each of the proposals to be voted on.

Webcast of Meeting

If you are not able to attend the Meeting in person, you may join a live webcast of the Meeting on the Internet by visiting http://investors.intuit.com on Thursday, January 22, 2015 at 8:00 a.m. Pacific Standard Time.

Meeting Information

The following chart describes the proposals to be considered at the meeting, the vote required to elect directors and to adopt each other proposal, the manner in which votes will be counted and the Board’s voting recommendation:
Proposal
 
Voting Options
 
Vote Required to Adopt the Proposal
 
Effect of Abstentions
 
Effect of Broker Non-Votes”
 
Board’s Voting Recommendation
1. Election of directors
 
For, against or abstain on each nominee
 
A nominee for director will be elected if the votes cast for such nominee exceed the votes cast against such nominee
 
No effect
 
No effect
 
FOR the election of each of the director nominees
2. Ratification of selection of Ernst & Young LLP
 
For, against or abstain
 
The affirmative vote of a majority of the shares of common stock represented at the annual meeting and voted for or against the proposal
 
No effect
 
No effect
 
FOR
3. Advisory vote to approve Intuit’s executive compensation
 
For, against or abstain
 
The affirmative vote of a majority of the shares of common stock represented at the annual meeting and voted for or against the proposal
 
No effect
 
No effect
 
FOR
4. Approval of an Amendment and Restatement of the Employee Stock Purchase Plan
 
For, against or abstain
 
The affirmative vote of a majority of the shares of common stock represented at the annual meeting and voted for or against the proposal
 
No effect
 
No effect
 
FOR



1


We will also consider any other matters that may properly be brought before the Meeting and any postponement(s) or adjournment(s) thereof. We have not yet received notice of other matters that may be properly presented at the annual meeting.

How to Vote

Please act as soon as possible to vote your shares, even if you plan to attend the Meeting. You may vote via the Internet, by telephone or, if you have received a printed version of these proxy materials, by mail. If your shares are held on your behalf by a broker, bank or other nominee, you must instruct your nominee on how to vote the shares held in your account. If you do not provide your nominee with voting instructions, your nominee may only vote on Proposal 2 (ratifying the selection of our independent registered public accountant).

Board Nominees

The following table provides summary information about each director nominee.
 
 
 
 
Committee Memberships
 
Name
Director Since
Occupation
Independent
AC
ARC
CODC
NGC
Other Public Company Boards
Incumbent Nominees
William V. Campbell
1994
Chairman of the Board of Directors, Intuit Inc.
 
 
 
 
 
GSV Capital Corp.
Scott D. Cook
1984
Founder and Chairman of the Executive Committee, Intuit Inc.
 
 
 
 
 
eBay Inc.;
The Procter & Gamble Company
Diane B. Greene (1)
2006
Former President and Chief Executive Officer, VMware, Inc.
X
 
X
 
X
Google, Inc.
Edward A. Kangas
2007
Non-Employee Chairman, Tenet Healthcare
X
X
 
C
X
Tenet Healthcare; Hovnanian Enterprises, Inc.;
United Technologies Corporation; IntelSat
Suzanne Nora Johnson
2007
Former Vice-Chairman, The Goldman Sachs Group
X
C
X
 
 
American International Group, Inc.; Pfizer Inc.; VISA Inc.
Dennis D. Powell
2004
Former Chief Financial Officer, Cisco Systems, Inc.
X
X
C
 
 
Applied Materials, Inc.; VMware, Inc.
Brad D. Smith
2008
President and Chief Executive Officer, Intuit Inc.
 
 
 
 
 
Nordstrom, Inc.
Jeff Weiner
2012
Chief Executive Officer, LinkedIn Corporation
X
 
 
X
 
LinkedIn Corporation
New Nominees
Richard Dalzell (2)
N/A
Former Senior Vice President and Chief Information Officer, Amazon.com, Inc.
X
 
 
 
 
AOL Inc.

(1) The Board has appointed Ms. Greene to serve as Chair of the Nominating and Governance Committee, effective as of the 2015 Annual Meeting date.
(2) The Board has appointed Mr. Dalzell to serve on the Compensation and Organizational Development Committee and the Nominating and Governance Committee, effective upon his election.

2


AC
 
Acquisition Committee
ARC
 
Audit and Risk Committee
CODC
 
Compensation and Organizational Development Committee
NGC
 
Nominating and Governance Committee
C
 
Chair
Attendance
 
All of our incumbent directors, including Christopher Brody, who declined to stand for re-election to the Board, attended at least 75% of the aggregate number of meetings of the Board and committees on which he or she sits.



Fiscal 2014 Executive Compensation Highlights

Intuit is strongly committed to pay for performance. To that end, our executive compensation programs are designed to reward both short- and long-term growth as well as total stockholder return (“TSR”). Our short-term performance-based compensation consists of annual cash bonuses, which are based upon achievement of annual corporate operating goals, including revenue and non-GAAP operating income growth, and individual performance. Our long-term compensation consists of performance-based RSUs based on relative total stockholder return (“Relative TSR RSUs”), RSUs and non-qualified stock options.

Intuit achieved fiscal 2014 revenue growth of 8.0%, non-GAAP operating income growth of 6.9% and non-GAAP earnings per share (“EPS”) growth of 10.0% (see table on page A-3 of this proxy statement for a reconciliation of non-GAAP financial measures) and a TSR of 29.5%. These results take into account both an acceleration to cloud-based subscriptions, which shifted some fiscal 2014 revenue into future reporting periods, as well expenses associated with a restructuring in the fourth quarter of fiscal 2014. Our revenue, operating income and earnings per share for the year were at the high end of our guidance range, after adjusting for the impact of the related restructuring charges.
   
Intuit’s TSR has performed well in recent years. We delivered 29.5% TSR during fiscal 2014, three-year annualized TSR of 21.9% and five-year annualized TSR of 23.3%, closing the year with our stock price at an all-time high. See the graph below, which compares the cumulative TSR on Intuit common stock for the last five full fiscal years with the cumulative total returns on the S&P 500 Index and the Morgan Stanley Technology Index for the same period. The graph assumes that $100 was invested in Intuit common stock and in each of the other indices on July 31, 2009 and that all dividends were reinvested. Intuit did not pay cash dividends prior to fiscal 2012. The comparisons in the graph below are based on historical data – with Intuit common stock prices based on the closing price on the dates indicated – and are not intended to forecast the possible future performance of Intuit’s common stock.



3



Compensation Practices
Intuit employs a number of practices that reflect our pay-for-performance compensation philosophy, including:
a significant portion of our fiscal 2014 senior executive officer compensation is in the form of incentives tied to achievement of particular performance measures. In addition to our annual cash bonus, 50% of equity incentive value was granted in the form of performance-based RSUs, which measure relative TSR against a group of other software and services companies of comparable size. The remaining 50% of equity incentive value was granted in the form of RSUs (which incorporate a one-year GAAP operating income hurdle) and stock options, both of which the Compensation Committee also consider to be performance-based compensation;
we do not provide special retirement benefits solely for executive officers;
we do not provide any excise tax “gross-up” payments;
we do not provide perquisites or other executive benefits based solely on rank;
we prohibit directors and executive officers from pledging Intuit stock and engaging in hedging transactions involving Intuit stock;
we have “clawback” provisions for operating performance-based equity awards; and
we have stock ownership guidelines for executive officers at the senior vice president level and above and non-employee directors, with the CEO guideline set at six times salary, the senior vice president level and above guideline set at one and a half times salary, and the non-employee director guideline set at five times annual retainer.


Fiscal 2014 Compensation Summary

Set forth below is the fiscal year 2014 compensation for each named executive officer as determined under the Securities and Exchange Commission rules. See the “Compensation Discussion and Analysis” and “Executive Compensation” sections of the proxy statement for a full explanation of each named executive officer’s compensation.


4


Name and Principal Position
 
Salary
 ($)
 
Bonus
 ($)
 
Stock Awards
 ($)
 
Option Awards
 ($)
 
Non-Equity Incentive Plan Compensation
 ($)
 
All Other Compensation
 ($)
 
Total
 ($)
Brad D. Smith
President and Chief Executive Officer
 
1,000,000

 

 
10,172,624

 
3,475,845

 
1,890,000

 
10,000

 
16,548,469

R. Neil Williams
Senior Vice President and Chief Financial Officer
 
700,000

 

 
3,226,791

 
1,081,187

 
630,000

 
10,000

 
5,647,978

Laura A. Fennell
Senior Vice President, General Counsel and Corporate Secretary
 
575,000

 

 
2,298,750

 
771,731

 
411,000

 
16,000

 
4,072,481

Sasan K. Goodarzi
Senior Vice President and General Manager, Consumer Tax Group
 
620,000

 

 
3,163,836

 
1,081,187

 
524,000

 
250,000

 
5,639,023

Daniel A. Wernikoff
Senior Vice President and General Manager, Small Business Group
 
525,000

 

 
3,010,934

 
1,029,229

 
358,500

 
13,000

 
4,936,663





5


CORPORATE GOVERNANCE

Intuit is committed to excellence in corporate governance and maintains policies and practices that promote good corporate governance, including the following:

The Board has adopted majority voting in uncontested elections of directors;

A majority of the board members are independent of Intuit and its management;

The independent members of the Board meet regularly without the presence of management;

All members of the committees of the Board are independent;

The charters of the committees of the Board clearly establish the committees’ respective roles and responsibilities;

Intuit has adopted a Code of Conduct & Ethics for employees that is monitored by Intuit’s ethics office;

Intuit’s ethics office has a hotline available to all employees, and Intuit’s Audit and Risk Committee has procedures in place to receive and process complaints, including on a confidential and anonymous basis, regarding accounting, internal accounting controls, auditing and federal securities law matters, or violations of the Code of Conduct & Ethics and for employees to make confidential, anonymous complaints regarding accounting, auditing and federal securities law matters or violations of the Intuit’s Code of Conduct & Ethics;

Intuit has adopted a Code of Ethics that applies to all directors;

Intuit’s internal audit control function maintains critical oversight over the key areas of its business and financial processes and controls, and reports directly to Intuit’s Audit and Risk Committee;

Intuit’s investor relations and management teams regularly communicate with our stockholders and report to the Board on the stockholders’ perspectives; and

The Board and its committees receive periodic updates on regulatory and other developments relevant to the Board from management and outside experts.

Our Board has adopted Corporate Governance Principles that are designed to assist the Board in observing practices and procedures that serve the best interests of Intuit and our stockholders. The Nominating and Governance Committee is responsible for overseeing these Corporate Governance Principles, reviewing them at least annually and making recommendations to the Board regarding any changes. These Corporate Governance Principles address, among other things, our policy on succession planning and senior leadership development, Board performance evaluations, committee structure and stock ownership requirements.
We maintain a corporate governance page on our company website that contains key information about corporate governance matters. This information includes copies of our Corporate Governance Principles, Political Accountability Policy, Code of Conduct & Ethics for all employees, including our Company’s senior executive and financial officers, our Operating Values, and the charter for each Board committee. The link to this corporate governance page can be found at http://investors.intuit.com/corporate-governance/conduct-and-guidelines/default.aspx.

6


Board Responsibilities, Leadership Structure and Executive Sessions
The Board oversees management’s performance on behalf of Intuit’s stockholders. The Board’s primary responsibilities are to (1) select, oversee and determine compensation for the Chief Executive Officer who, with senior management, runs Intuit on a day-to-day basis, (2) monitor management’s performance to assess whether Intuit is operating in an effective, efficient and ethical manner in order to create value for Intuit’s stockholders, and (3) periodically review Intuit’s long-range plan, business initiatives, capital projects and budget matters. The Chairman of the Board presides over all Board meetings and works with the Chief Executive Officer to develop agendas for Board meetings. The Chairman advises the Chief Executive Officer and other members of senior management on business strategy and leadership development. He also works with the Board to drive decisions about particular strategies and policies and, in concert with the independent Board committees, facilitates a performance evaluation process of the Board.
The Board appoints a Chairman, who may be a former officer of Intuit if the Board determines that it is in the best interests of Intuit and its stockholders. The roles of Chairman of the Board and Chief Executive Officer may be held by the same person or different people. However, if the Chairman is also the Chief Executive Officer, then the Board has determined that it will appoint a lead independent director. Currently, the positions of Chairman of the Board and Chief Executive Officer are held by separate persons. The Board believes that the separation of the roles of Chairman of the Board and Chief Executive Officer is appropriate at this time as it allows our Chief Executive Officer to focus primarily on management and strategy responsibilities and our Chairman to focus on leadership of the Board, providing feedback and advice to the Chief Executive Officer and serving as a channel of communication between the Board members and the Chief Executive Officer. William V. Campbell, the current Chairman of the Board, is a non-executive employee of Intuit and previously served as Intuit’s chief executive officer.
The Board and its committees meet throughout the year on a set schedule, and also hold special meetings and act by written consent from time to time as appropriate. The Board held four meetings during fiscal 2014. The independent directors also spend a portion of every regularly scheduled meeting in executive session and designate an independent director to serve as presiding director to chair these sessions. During fiscal 2014, Christopher Brody, the Nominating and Governance Committee chair, served as the presiding director of all executive sessions. In addition, the presiding director may advise the Chairman of the Board with respect to agendas and information to be provided to the Board and may perform such other duties as the Board may from time to time request to assist it in fulfilling its responsibilities. The Board has delegated certain responsibilities and authority to the committees described below. Committees report regularly on their activities and actions to the full Board.
Board Oversight of Risk
Intuit’s management is responsible for balancing risk and opportunity in support of Intuit’s objectives. Management exercises this responsibility day to day through ongoing identification of risks related to significant business activities, implementation of risk mitigation activities and alignment of risk management to the Company’s strategy. Intuit’s Chief Risk Officer, who reports through to our General Counsel, facilitates the Enterprise Risk Management, or “ERM,” program as part of our strategic planning process. The ERM program helps identify the top risks for each business unit and for Intuit as a whole.
The Board oversees risk management for the Company both directly and through its committees, as follows:
The Audit and Risk Committee has primary responsibility for overseeing our ERM program. The Chief Risk Officer reports on a quarterly basis to the Audit and Risk Committee on Intuit’s top risk areas and the progress of the ERM program. The Audit and Risk Committee also has oversight responsibilities with respect to particular risks such as financial management and fraud.
The Board’s other committees – Compensation and Organizational Development, Nominating and Governance, and Acquisition – oversee risks associated with their respective areas of responsibility. The Compensation and Organizational Development Committee considers the risks associated with our compensation policies and practices for executives and employees generally. The Nominating and Governance Committee considers risks associated with corporate governance and overall board effectiveness, including recruiting appropriate Board members. The Acquisition Committee considers risks associated with Intuit’s merger and acquisition activities and the strategy and business models of acquisition candidates.
At each quarterly Board meeting, members of each committee provide a report to the full Board covering the committee’s risk oversight and other activities. The full Board receives an annual update from the Chief Risk Officer regarding the top enterprise-wide risks. The full Board also considers and provides oversight of specific strategic risks, including those relating to Intuit’s business models and inorganic growth strategy. The Board also receives detailed reports at quarterly Board meetings from the Chief Executive Officer and the heads of our principal business units,

7


which include discussions of the risks involved in their respective areas of responsibility. The senior management team also informs the Board routinely of developments that could affect our risk profile or other aspects of our business.
Compensation Risk Assessment
The Company conducted a review of its key compensation programs, policies and practices in conjunction with Frederic W. Cook & Co., Inc. (“FW Cook”), the Compensation and Organizational Development Committee’s independent compensation consultant, which prepared a report on the Company’s incentive programs.
The review included an analysis of the Company’s short-term and long-term compensation programs, covering key program details, performance factors for each program, target award ranges, maximum funding levels, and plan administrative oversight and control requirements. The assessment of potential compensation-related risks considered pay mix, performance metrics, performance goals and payout curves, payment timing and adjustments, severance packages, equity incentives and stock ownership requirements and trading policies.
This analysis was reviewed with the Compensation and Organizational Development Committee at its October 28, 2014 meeting. The review and analysis did not identify any compensation programs, policies or practices that create risks that are reasonably likely to have a material adverse effect on the Company.
The analysis noted the following factors that reduce the likelihood of excessive risk-taking at Intuit:
Overall compensation levels are in a competitive market range.
The compensation programs provide an effective balance in (1) cash and equity mix, (2) annual incentives that are based in part on company-wide performance metrics that align with the Company’s business plans and strategic objectives and in part on a qualitative evaluation of business unit and individual performance, and (3) long-term incentives provided through a combination of stock options (generally vesting over three years with terms of seven years), time-based RSUs (generally vesting over three years), and performance-based RSUs (earned after three years based on one-, two- and three-year relative TSR).
Stock ownership guidelines for executive officers at the senior vice president level and above as well as non-employee directors.
The insider trading policy, which prohibits officers from pledging shares, trading put or call options, and engaging in short sales or hedging transactions involving the Company’s securities.
“Clawback” provisions for operating performance-based equity awards.
Director Independence
To be considered independent under NASDAQ rules, a director may not be employed by Intuit or engage in certain types of business dealings with Intuit. In assessing director independence under NASDAQ rules, the Nominating and Governance Committee and the full Board review relevant transactions, relationships and arrangements that may affect the independence of our Board members. In addition, as required by NASDAQ rules, the Board makes a determination as to each independent director that no relationship exists which, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In making these determinations, the Board reviewed and discussed information provided by the directors and by Intuit with regard to each director’s business and personal activities as they relate to Intuit and Intuit’s management.
Each of Mr. Powell, Mr. Kangas, Ms. Nora Johnson, Ms. Greene and Mr. Weiner is or was during fiscal 2014 a director of companies with which Intuit conducts business in the ordinary course. Consistent with NASDAQ independence standards, Intuit did not make payments to, or receive payments from, any of these companies for property or services in the current or any of the last three fiscal years that exceed 5% of Intuit’s or any of the other parties’ consolidated gross revenues. Upon review of these relationships and the other information provided by our directors and director nominees, the Board determined that the following current directors and director nominees are independent: Mr. Brody, Mr. Dalzell (nominee), Ms. Greene, Mr. Kangas, Ms. Nora Johnson, Mr. Powell and Mr. Weiner.
Attendance at Board, Committee and Annual Stockholders Meetings
The Board expects that each director will prepare for, attend and participate in all Board and applicable committee meetings and that each Board member will see that other commitments do not materially interfere with his or her service on the Board. Directors generally may not serve on the boards of more than six public companies, including Intuit’s Board. Any director, who has a principal job change, including retirement, must offer to submit a letter of resignation to the Chairman of

8


the Board. The Board, in consultation with the Nominating and Governance Committee, will review each offered resignation and determine whether or not to accept such resignation after consideration of the continued appropriateness of Board membership under the new circumstances.
During fiscal 2014, all directors attended at least 75% of the aggregate number of meetings of the Board and the committees on which he or she served. Seven of our nine current directors attended the last Annual Meeting of Stockholders held in January 2014. Our Corporate Governance Principles encourage all directors to attend our annual meeting of stockholders.

Board Committees and Charters
The Board currently has a standing Acquisition Committee, Audit and Risk Committee, Compensation and Organizational Development Committee, and Nominating and Governance Committee. Each committee has a charter which it reviews annually and makes recommendations to our Board for its revision to reflect evolving best practices. Copies of each charter can be found on our website at http://investors.intuit.com/corporate-governance/conduct-and-guidelines/default.aspx. The members of each committee are independent and appointed by the Board based on recommendations of the Nominating and Governance Committee. Current committee members are identified in the following table.

Director (1)
 
Acquisition Committee
 
Audit and Risk Committee
 
Compensation and Organizational Development Committee
 
Nominating and Governance Committee
Christopher W. Brody(2)
 
 
 
 
 
X
 
Chair
William V. Campbell
 
 
 
 
 
 
 
 
Scott D. Cook
 
 
 
 
 
 
 
 
Diane B. Greene
 
 
 
X
 
 
 
X (3)
Edward A. Kangas
 
X
 
 
 
Chair
 
X
Suzanne Nora Johnson
 
Chair
 
X
 
 
 
 
Dennis D. Powell
 
X
 
Chair
 
 
 
 
Brad D. Smith
 
 
 
 
 
 
 
 
Jeff Weiner
 
 
 
 
 
X
 
 
Number of meetings in Fiscal 2014
 
5
 
9
 
7
 
4
(1) The Board has appointed Mr. Dalzell to serve on the Compensation and Organizational Development Committee and the Nominating and Governance Committee, effective upon his election.
(2) Mr. Brody declined to stand for re-election to the Board.
(3) Ms. Greene has been appointed by the Board to serve as Chair of the Nominating and Governance Committee, effective as of the 2015 Annual Meeting date.


Acquisition Committee
The Acquisition Committee reviews and approves acquisition, divestiture and investment transactions proposed by Intuit’s management in which the total consideration to be paid or received by Intuit is within certain limits that may be established by the Board from time to time.
Audit and Risk Committee
The Audit and Risk Committee represents and assists the Board in its oversight of Intuit’s financial reporting, internal controls and audit functions, and is directly responsible for the selection, retention, compensation and oversight of the work of Intuit’s independent auditor.
Our Board has determined that each member of the Audit and Risk Committee is independent, as defined under applicable NASDAQ listing standards and SEC rules related to audit committee members, and is financially literate, as required by NASDAQ listing standards. All members of the Audit and Risk Committee have been determined by the Board to meet the qualifications of an “audit committee financial expert,” as defined by SEC rules, and to meet the qualifications of “financial sophistication” in accordance with NASDAQ listing standards.

9


The Audit and Risk Committee held closed sessions with our independent auditors, Ernst & Young LLP, in all of its meetings.
Compensation and Organizational Development Committee
The Compensation and Organizational Development Committee (the “Compensation Committee”) assists the Board in the review and approval of executive compensation and the oversight of organizational and management development for executive officers and other employees of Intuit. The Compensation Committee periodically reviews Intuit’s key management from the perspectives of leadership development, organizational development and succession planning through Intuit’s High Performance Organization Review. As part of this process, the Compensation Committee also meets with key senior executives. The systemic assessment of Intuit’s organization and talent planning helped the Compensation Committee to evaluate Intuit’s effort at hiring, developing and retaining executives, with the goal of creating and growing Intuit’s “bench strength” at the most senior executive levels.
Each member of this Committee, as well as Mr. Dalzell, who has been nominated to serve on the Compensation Committee if elected at the 2015 Annual Meeting, is independent under NASDAQ listing standards and is a “Non-Employee Director,” as defined in Rule 16(b)-3 under the Securities Exchange Act of 1934, as amended. The Compensation Committee held a portion of each meeting in closed session, with only the Compensation Committee members and, on certain occasions, William Campbell, the Chairman of the Board, present. For more information on the responsibilities and activities of the Compensation Committee, including the committee’s processes for determining executive compensation, see the “Compensation and Organizational Development Committee Report” on page 25 and “Compensation Discussion and Analysis” beginning on page 26, including in particular, the discussion of the “Role of Compensation Consultants, Executive Officers and the Board in Compensation Determinations” beginning on page 43.
The Compensation Committee is also responsible for reviewing the compensation for non-employee directors on an annual basis and making recommendations to the Board, in the event the Committee determines changes are appropriate.
Section 162(m) Subcommittee
 
Because in fiscal 2014 not all of the members of the Compensation Committee were “outside directors” for purposes of Regulation 1.162-27 under Section 162(m) of the Internal Revenue Code (“Section 162(m)”), the Compensation Committee designated a Section 162(m) subcommittee and appointed Mr. Kangas and Mr. Brody, both of whom are “outside directors” to serve on it. This subcommittee has responsibility and authority to review and approve all elements of compensation that may require approval by a committee of “outside directors” in order for such compensation to qualify for deductibility under Section 162(m) and related regulations. This subcommittee met three times in fiscal 2014.
Compensation Committee Interlocks and Insider Participation
None of Messrs. Kangas, Brody or Weiner, each of whom served on the Compensation Committee during fiscal 2014, has at any time been one of our executive officers or employees. No executive officer of Intuit during fiscal 2014 served, or currently serves, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on Intuit’s Board or Intuit’s Compensation Committee.
Nominating and Governance Committee
The Nominating and Governance Committee reviews and makes recommendations to the Board regarding Board composition and appropriate governance standards. Our Board has determined that each member of the Nominating and Governance Committee is independent, as defined under applicable NASDAQ listing standards.
The Nominating and Governance Committee has adopted a process to identify and evaluate candidates for director, whether recommended by management, Board members, or stockholders (if made in accordance with the procedures set forth under “Stockholder Recommendations of Director Candidates” on page 11). The Committee’s policy is to evaluate candidates properly recommended by stockholders in the same manner as candidates recommended by others.
Qualifications of Directors
The Nominating and Governance Committee believes that all nominees for Board membership should possess the highest ethics, integrity and values and be committed to representing the long-term interests of Intuit’s stockholders. In addition, nominees should have broad, high-level experience in business, government, education, technology or public interest. They should have sufficient time to carry out their duties as directors of Intuit and have an inquisitive and objective perspective, practical wisdom and mature judgment. The Nominating and Governance Committee will also consider additional factors –

10


such as independence, diversity, expertise and specific skills, and other qualities that may contribute to the Board’s overall effectiveness – when evaluating candidates for director. The Nominating and Governance Committee may also engage third-party search firms to provide assistance in identifying and evaluating Board candidates.
Consideration of director candidates typically involves a series of discussions and a review of available information concerning the candidate, the existing composition of the Board and other factors the Committee deems relevant. In conducting its review and evaluation, the Nominating and Governance Committee may solicit the views of management, other Board members and other individuals it believes may have insight into a candidate.
In considering diversity in the selection of nominees, the Nominating and Governance Committee looks for individuals with varied professional experience, background, knowledge, skills and viewpoints in order to achieve and maintain a group of directors that, as a whole, provides effective oversight of the management of the Company. Although our nomination policy does not prescribe specific standards for diversity, the Board and the Nominating and Governance Committee do look for nominees with a diverse set of skills that will complement the existing skills and experience of our directors and provide an overall balance of diversity of perspectives, backgrounds and experiences. The Nominating and Governance Committee assesses its effectiveness in this regard as part of its annual evaluation process. Our Board is currently composed of a group of leaders with broad and diverse experience in many fields, including: management of large global enterprises; technology and innovation leadership; strategic planning; consumer software and technology products and services; public policy; social networking; healthcare; and financial services; legal and compliance; executive compensation; and corporate governance. Our Board members have acquired these diverse skills through their accomplished careers and their service as directors of a wide range of other public and private companies.
Stockholder Recommendations of Director Candidates
As discussed above, our Nominating and Governance Committee will consider director candidates recommended by a stockholder. A stockholder seeking to recommend a candidate for the committee’s consideration should submit the candidate’s name and qualifications to: Nominating and Governance Committee, c/o Corporate Secretary, Intuit Inc., P.O. Box 7850, Mail Stop 2700, Mountain View, California 94039-7850 or via our website at http://investors.intuit.com/corporate-governance/conduct-and-guidelines/contact-the-board/default.aspx. You may find a copy of a document entitled “Process of Identifying and Evaluating Nominees for Director” on our website http://investors.intuit.com/corporate-governance/conduct-and-guidelines/default.aspx.

Stockholder Engagement Process

Intuit regularly engages with stockholders to better understand their perspectives. During fiscal 2014 we held discussions with our largest stockholders during scheduled events such as our annual meeting and investor day, as well as regularly throughout the year. In September 2014 we hosted our annual investor day, which presents an opportunity for our management team to interact directly with our stockholders regarding our performance in the prior year and our short- and long-term growth strategies. Management and the investor relations team regularly share investor and stockholder feedback with the Board of Directors. In general, our stockholders have not raised concerns regarding our compensation programs. We will continue to engage with our stockholders on a regular basis in order to understand and consider their views on our executive compensation programs and corporate governance practices.

Stockholder Communications with the Board
The Nominating and Governance Committee is responsible for receiving stockholder communications on behalf of the Board. Any stockholder may send communications by mail to the Board or individual directors c/o Corporate Secretary, Intuit Inc., P.O. Box 7850, Mail Stop 2700, Mountain View, California 94039-7850 or via our website at http://investors.intuit.com/corporate-governance/conduct-and-guidelines/contact-the-board/default.aspx. The Board has instructed the Corporate Secretary to review this correspondence and determine, in his or her discretion, whether matters submitted are appropriate for Board consideration. The Corporate Secretary may also forward certain communications elsewhere in the Company for review and possible response. In particular, communications such as product or commercial inquiries or complaints, job inquiries, surveys and business solicitations or advertisements or patently offensive or otherwise inappropriate material will not be forwarded to the Board.

11


SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership Table
The following table shows shares of Intuit’s common stock that we believe are owned as of October 31, 2014 by:
Each Named Executive Officer (defined on page 26),
Each director and nominee,
All current directors, nominees and executive officers as a group, and
Each stockholder beneficially owning more than 5% of our common stock.
Unless indicated in the notes, each stockholder has sole voting and investment power for all shares shown, subject to community property laws that may apply to create shared voting and investment power. Unless indicated in the notes, the address of each beneficial owner is c/o Intuit Inc., P.O. Box 7850, Mountain View, California 94039-7850.
We calculated the “Percent of Class” based on 285,418,643 shares of common stock outstanding on October 31, 2014. In accordance with SEC regulations, we also include (1) shares subject to options that are currently exercisable or will become exercisable within 60 days of October 31, 2014, and (2) shares issuable upon settlement of RSUs that are vested but unreleased, or will become vested within 60 days of October 31, 2014. Those shares are deemed to be outstanding and beneficially owned by the person holding such option or RSU for the purpose of computing the percentage ownership of that person, but they are not treated as outstanding for the purpose of computing the percentage ownership of any other person.
Name of Beneficial Owner
 
Amount and Nature of Beneficial Ownership (#)
 
Percent of Class (%)
Directors, Director Nominees and Executive Officers:
 
 

 
 

Scott D. Cook(1)
 
13,091,835

 
4.59
%
Brad D. Smith(2)
 
1,057,224

 
*

R. Neil Williams(3)
 
67,526

 
*

Laura A. Fennell(4)
 
69,768

 
*

Sasan K. Goodarzi(5)
 
137,156

 
*

Daniel A. Wernikoff(6)
 
79,613

 
*

Christopher W. Brody (7)
 
358,972

 
*

William V. Campbell(8)
 
92,642

 
*

Richard L. Dalzell
 

 


Diane B. Greene(9)
 
83,530

 
*

Edward A. Kangas(10)
 
62,116

 
*

Suzanne Nora Johnson(11)
 
99,374

 
*

Dennis D. Powell(12)
 
105,323

 
*

Jeff Weiner(13)
 
10,017

 
*

All current directors and executive officers as a group (16 people)(14)
 
15,323,634

 
5.34
%
Other 5% Stockholders:
 
 

 
 

Capital Research Global Investors(15)
 
17,910,200

 
6.28
%
BlackRock, Inc.(16)
 
16,876,646

 
5.91
%

_______________________________________
 
Indicates ownership of 1% or less.
(1)
Represents 13,091,835 shares held by trusts, of which Mr. Cook is a trustee.
(2)
Includes 817,842 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Mr. Smith and 84,918 shares held by a family trust, of which Mr. Smith is a trustee.

12


(3)
Includes 56,018 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Mr. Williams.
(4)
Includes 68,789 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Ms. Fennell.
(5)
Includes 133,977 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Mr. Goodarzi.
(6)
Includes 79,583 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Mr. Wernikoff.
(7)
Includes 84,855 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Mr. Brody.
(8)
Includes 8,637 shares issuable upon settlement of vested restricted stock units held by Mr. Campbell.
(9)
Includes 69,855 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Ms. Greene.
(10)
Represents 62,116 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Mr. Kangas.
(11)
Includes 83,637 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Ms. Nora Johnson.
(12)
Includes 88,637 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by Mr. Powell.
(13)
Represents 10,017 shares issuable upon settlement of vested restricted stock units held by Mr. Weiner.
(14)
Includes 1,572,114 shares issuable upon exercise of options and upon settlement of vested restricted stock units. Represents shares and options held by the 14 individuals in the table, plus an additional 8,538 outstanding shares and 8,151 shares issuable upon exercise of options and upon settlement of vested restricted stock units held by other executive officers.
(15)
Ownership information for Capital Research Global Investors (“Capital Research”) is based on a Schedule 13G filed with the SEC by Capital Research, reporting ownership as of December 31, 2013. Capital Research reported sole voting power and sole dispositive power as to 17,910,200 shares. The address of Capital Research is 333 Hope Street, Los Angeles, California 90071.
(16)
Ownership information for BlackRock, Inc. (“BlackRock”) is based on a Schedule 13G/A filed with the SEC by BlackRock, reporting ownership as of December 31, 2013. BlackRock reported sole voting power as to 14,017,281 shares and sole dispositive power as to 16,876,646 shares. The address of BlackRock is 40 East 52nd Street, New York, New York 10022.

Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires Intuit’s directors and executive officers, and greater-than-10% stockholders to file forms with the SEC to report their ownership of Intuit shares and any changes in ownership. Anyone required to file forms with the SEC must also send copies of the forms to Intuit. We have reviewed all forms provided to us. Based on that review and on written information given to us by our executive officers and directors, we believe that all Section 16(a) filing requirements were met during fiscal 2014.

13


PROPOSAL NO. 1
ELECTION OF DIRECTORS

Election of Directors
The board currently consists of nine directors, eight of whom were nominated for election to the Board based on the recommendation of our Nominating and Governance Committee. Christopher Brody declined to stand for re-election to the Board of Directors. The Nominating and Governance Committee also recommended Richard L. Dalzell for nomination by our full Board, after he was identified by Mr. Smith. The Board of Directors considered and conducted interviews of multiple candidates, including Mr. Dalzell. Based on the recommendations of the Nominating and Governance Committee, our Board has nominated William V. Campbell, Scott D. Cook, Richard L. Dalzell, Diane B. Greene, Edward A. Kangas, Suzanne Nora Johnson, Dennis D. Powell, Brad D. Smith and Jeff Weiner for election at the Meeting.
Each nominee, if elected, will serve until the next annual meeting of stockholders and until a qualified successor is elected, unless the nominee dies, resigns or is removed from the Board prior to such meeting. Although we know of no reason why any of the nominees would not be able to serve, if any nominee is unavailable for election, the proxy holder will vote your shares to approve the election of any substitute nominee proposed by the Board.
Each of our director nominees, except for Mr. Dalzell, is currently serving on the Board. If a nominee who is currently serving as a director is not re-elected, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” However, in accordance with Intuit’s Bylaws and Corporate Governance Principles, each director has submitted an advance, contingent, irrevocable resignation that the Board may accept if stockholders do not elect the director. In that situation, our Nominating and Governance Committee would make a recommendation to the Board about whether to accept or reject the resignation, or whether to take other action. The Board would act on the Nominating and Governance Committee’s recommendation, and publicly disclose its decision and the rationale behind it within 90 days of the date that the election results were certified.
Directors Standing for Election
Information concerning the nominees for director is provided below.
William V. Campbell (Age 74)
Chairman of the Board of Directors, Intuit Inc.

Mr. Campbell has been an Intuit director since 1994. He served as Intuit’s President and Chief Executive Officer from April 1994 through July 1998. He has served as Chairman of the Board since August 1998 and was Acting Chief Executive Officer from September 1999 until January 2000.  Mr. Campbell has served on the Board of Directors of GSV Capital Corporation since 2012 and recently retired from the Board of Directors of Apple, Inc. after 17 years of service.  Mr. Campbell holds a Bachelor of Arts in Economics and a Masters of Science from Columbia University, where he was the Chair, and remains a member of, the Board of Trustees.
Mr. Campbell brings to the Board professional experience managing and advising innovative high growth companies, leadership throughout the technology industry and his understanding of Intuit, its strategy, markets, operations and management.
Scott D. Cook (Age 62)
Founder and Chairman of the Executive Committee, Intuit Inc.

Mr. Cook has been an Intuit director since 1984. A co-founder of Intuit, Mr. Cook served as Intuit’s President and Chief Executive Officer from 1984 to 1994 and served as Chairman of the Board from 1993 to 1998. Mr. Cook has been a director of eBay Inc. since 1998 where he is a member of the Corporate Governance and Nominating Committee. Mr. Cook has been a director of The Procter & Gamble Company since 2000 where he chairs the Innovation & Technology Committee and is a member of the Compensation & Leadership Development Committee. Mr. Cook holds a Bachelor of Arts in Economics and Mathematics from the University of Southern California and a Master in Business Administration from Harvard Business School.
    
Mr. Cook brings to the Board experience as an entrepreneur and corporate executive with a background in guiding and fostering innovation, as well as his knowledge of Intuit’s operations, markets, management and strategy and his experience as a Board member of other large consumer-focused companies.

14


Richard Dalzell (Age 57)
Former Senior Vice President and Chief Information Officer, Amazon.com, Inc.

Mr. Dalzell, a director nominee, was Senior Vice President and Chief Information Officer of Amazon.com, Inc., an online retailer, until his retirement in 2007. Previously, Mr. Dalzell served in numerous other positions at Amazon.com, Inc., including Senior Vice President of Worldwide Architecture and Platform Software and Chief Information Officer from 2001 to 2007, Senior Vice President and Chief Information Officer from 2000 to 2001 and Vice President and Chief Information Officer from 1997 to 2000. Prior to his employment with Amazon.com, Inc., Mr. Dalzell was Vice President of the Information Systems Division at Wal-Mart Stores, Inc. from 1994 to 1997. Mr. Dalzell has been a director of AOL.com, Inc. since 2009, where he serves on the Compensation and Leadership Committee. Mr. Dalzell holds a Bachelor of Science degree in Engineering from the United States Military Academy at West Point.

Mr. Dalzell will bring to the Board extensive experience, expertise and background in Internet information technology gained from his service as the Chief Information Officer of Amazon.com, Inc. He will also bring corporate leadership experience gained from his service in various senior executive roles at Amazon.com, Inc.
Diane B. Greene (Age 59)
Former President and Chief Executive Officer, VMware, Inc.

Ms. Greene has been an Intuit director since 2006 and is a member of the Audit and Risk Committee and the Nominating and Governance Committee. She has also been nominated to serve as Chair of the Nominating and Governance Committee, effective as of the 2015 Annual Meeting. Ms. Greene co-founded VMware, Inc. in 1998 and took the company public in 2007. Ms. Greene served as chief executive officer and president of VMware from 1998 to 2008, a member of the board of directors of VMware from 2007 to 2008, and as an Executive Vice President of EMC Corporation from 2005 to 2008. Prior to VMware, Ms. Greene held technical leadership positions at Silicon Graphics, Tandem, and Sybase and was chief executive officer of VXtreme. She has also served on the board of directors of Google since January 2012. In addition to Ms. Greene’s public company board experience, she is a member of The MIT Corporation. Ms. Greene holds a Bachelor of Arts in mechanical engineering from the University of Vermont, a Master of Science degree in naval architecture from the Massachusetts Institute of Technology and a Master of Science degree in computer science from the University of California, Berkeley.

Ms. Greene brings to the Board experience and insight as a successful technology entrepreneur and former chief executive officer of a public company, as well as expertise and knowledge of cloud computing and software as a service businesses.
Edward A. Kangas (Age 70)
Non-Employee Chairman, Tenet Healthcare

Mr. Kangas has been an Intuit director since 2007 and is Chairman of the Compensation and Organizational Development Committee and a member of the Acquisition and Nominating and Governance Committees. Mr. Kangas has been the non-executive chairman of Tenet Healthcare since 2003. From 1989 to 2000, Mr. Kangas was global chairman and chief executive officer of Deloitte. Mr. Kangas held the position of managing partner of Deloitte & Touche (USA) from 1989 to 1994. Mr. Kangas has been a member of the board of directors of: Hovnanian Enterprises, Inc. since 2002; United Technologies Corporation since 2008 and IntelSat since 2012. Mr. Kangas was a member of the board of Electronic Data Systems Corporation from 2004 to 2008, Eclipsys Corporation from 2004 to 2010 and Allscripts Healthcare Solutions from 2010 to 2012. Mr. Kangas holds a Bachelor’s degree and a Master’s degree in Business Administration from the University of Kansas.

Mr. Kangas brings to the Board global executive experience as well as his knowledge and expertise acquired through his service as a director of companies in industries that are highly relevant to Intuit’s businesses, including the software, technology, professional services and healthcare industries.
Suzanne Nora Johnson (Age 57)
Former Vice-Chairman, The Goldman Sachs Group

Ms. Nora Johnson has been an Intuit director since 2007 and is Chairman of the Acquisition Committee and is a member of the Audit and Risk Committee. Ms. Nora Johnson joined The Goldman Sachs Group in 1985 and held several management positions throughout her tenure including: Vice Chairman, Chairman of the Global Markets Institute, and Head of the Global Investments Research Division. Ms. Nora Johnson has been a member of the board of directors of: American

15


International Group, Inc. since 2008; Pfizer Inc. since 2007; and VISA Inc. since 2007. Ms. Nora Johnson’s significant non-profit board affiliations include, among others, the American Red Cross and the University of Southern California. Ms. Nora Johnson earned a Bachelor’s degree from the University of Southern California and a Juris Doctor from Harvard Law School.

Ms. Nora Johnson brings to the Board valuable business experience managing large, complex, global institutions as well as insights into how changes in the financial services industry, public policy and the macro-economic environment affect our businesses.
Dennis D. Powell (Age 66)
Former Chief Financial Officer, Cisco Systems, Inc.

Mr. Powell has been an Intuit director since 2004 and is Chairman of the Audit and Risk Committee and a member of the Acquisition Committee. Mr. Powell was executive advisor of Cisco Systems, Inc. from 2008 to 2010. Mr. Powell joined Cisco in 1997 and held several management positions throughout his tenure including: Executive Vice President and Chief Financial Officer from 2003 to 2008; Senior Vice President, Corporate Finance Vice President from 2002 to 2003; and Corporate Controller from 1997 to 2002. Prior to Cisco, Mr. Powell held the position of senior partner at Coopers & Lybrand LLP, where his tenure spanned 26 years. Mr. Powell has been a member of the boards of directors of Applied Materials, Inc. since 2007 and VMware, Inc. since 2007. Mr. Powell holds a Bachelor of Science in Business Administration with a concentration in accounting from Oregon State University.

Mr. Powell brings to the Board executive management experience with large, global organizations as well as insights into financial and operational issues, which he has gained through his tenure as an executive at a large public technology company.
Brad D. Smith (Age 50)
President and Chief Executive Officer, Intuit Inc.

Mr. Smith has been an Intuit director since 2008 and is currently President and Chief Executive Officer of Intuit. Mr. Smith joined Intuit in 2003 and has served as Senior Vice President and General Manager, Small Business Division from 2006 to 2007, Senior Vice President and General Manager, QuickBooks from 2005 to 2006, Senior Vice President and General Manager, Consumer Tax Group from 2004 to 2005 and as Vice President and General Manager of Intuit’s Accountant Central and Developer Network from 2003 to 2004. Before joining Intuit, Mr. Smith held the position of Senior Vice President of Marketing and Business Development of ADP, where he held several executive positions from 1996 to 2003. Mr. Smith served on the board of directors of Yahoo! Inc. from 2010 until 2013. Mr. Smith was elected to the board of directors of Nordstrom, Inc. in June 2013 and serves on the Audit Committee and Technology Committee. Mr. Smith holds a Bachelor’s degree in Business Administration from Marshall University and a Master’s degree in Management from Aquinas College.

Mr. Smith, as Chief Executive Officer of Intuit, brings to the Board the most relevant knowledge of Intuit’s strategy, markets, operations and employees and provides industry expertise and context on all matters that come before the Board.
Jeff Weiner (Age 44)
Chief Executive Officer, LinkedIn Corporation

Mr. Weiner has been a director of Intuit since April 2012 and is a member of the Compensation and Organizational Development Committee. He has served as the Chief Executive Officer of LinkedIn, an Internet professional network provider, since June 2009, and as a director of LinkedIn since July 2009. He served as LinkedIn’s Interim President from December 2008 until June 2009. Before joining LinkedIn, Mr. Weiner was an executive in residence at Accel Partners and Greylock Partners, both venture capital firms, from September 2008 to June 2009. From May 2001 to June 2008 he held several positions at Yahoo! Inc., one of the world’s largest digital media companies, including most recently as an Executive Vice President of Yahoo’s network division. He holds a bachelor’s degree in economics from The Wharton School at the University of Pennsylvania.
Mr. Weiner brings to the Board experience and insights as the chief executive officer of a successful public technology company as well expertise and knowledge in social networking, consumer web and mobile products.

The Board recommends that you vote
FOR the election of each of the nominated directors.

16


DIRECTOR COMPENSATION

Overview

Our director compensation programs are designed to provide an appropriate incentive to attract and retain qualified non-employee board members. The Compensation Committee is responsible for reviewing the equity and cash compensation for directors on an annual basis and making recommendations to the Board, in the event the Compensation Committee determines changes are needed. The following table summarizes the fiscal 2014 compensation earned by each member of the Board other than Mr. Smith, whose compensation is described under “Executive Compensation” beginning on page 45.
Director Summary Compensation Table

Director Name
 
Fees Earned or Paid in Cash ($)
 
Stock Awards ($)(1)
 
All Other Compensation ($)
 
Total ($)
Christopher W. Brody
 
102,500

 
 
260,002

 
 

 
 
362,502

William V. Campbell
 
251,154

(2)
 
260,002

 
 
5,000,000

(3)
 
5,511,156

Scott D. Cook
 

 
 

 
 
979,000

(4)
 
979,000

Diane B. Greene
 
85,000

 
 
260,002

 
 

 
 
345,002

Edward A. Kangas
 
29,375

(5)
 
379,969

(5)
 

 
 
409,344

Suzanne Nora Johnson
 
107,500

 
 
260,002

 
 

 
 
367,502

Dennis D. Powell
 
122,500

 
 
260,002

 
 

 
 
382,502

Jeff Weiner
 
75,000

 
 
260,002

 
 

 
 
335,002

_______________________________________
(1)
These amounts represent the aggregate grant date fair value of RSUs granted during fiscal 2014, computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, “Compensation – Stock Compensation,” (“FASB ASC Topic 718”), assuming no forfeitures. Please see the “Equity Grants to Directors During Fiscal Year 2014” and “Outstanding Equity Awards for Directors at Fiscal Year-End 2014 (Exercisable and Unexercisable)” tables for information regarding the grant date fair value of RSUs granted during the fiscal year and the number of awards outstanding for each director at the end of the fiscal year.
(2)
This amount represents a stipend paid to Mr. Campbell for his role as a member and Non-Executive Chairman of the Board, in accordance with the compensation program adopted by the Board which became effective in January 2012.
(3)
The other compensation listed for Mr. Campbell consists of a $5,000,000 donation the Company made to the Campbell Legacy at Columbia, which supports the students of Columbia College, primarily via scholarships, and the faculty who teach them. In November 2013 when the donation was made, Mr. Campbell served as the Chair of the Columbia University board of trustees, and he now serves as its Chair Emeritus. Mr. Campbell was not involved in the solicitation, consideration or approval of this donation, and he receives no compensation from Columbia University and derives no financial benefit from the donation. The donation was unanimously approved by both the Audit and Risk Committee and the Compensation and Organizational Development Committee.
(4)
Mr. Cook is an employee of Intuit; thus, he is not compensated as a director. Mr. Cook’s compensation represents an annual salary of $550,000; and an incentive bonus of $429,000 awarded for service in fiscal 2014. Mr. Cook did not receive any equity awards from Intuit during fiscal 2014.
(5)
Mr. Kangas received fees due him for service on the Board during the quarter ended October 31, 2014 (the first quarter of Intuit’s fiscal 2014) in cash. He elected to receive fees due him for service on the Board during calendar year 2014 in RSUs, in accordance with Intuit’s Director Compensation Program, which is tied to the calendar year rather than Intuit’s fiscal year. These RSUs were awarded in January 2014, and are in respect of service provided during calendar year 2014 (which includes the first quarter of Intuit’s fiscal 2015). Please see the “Equity Grants to Directors During Fiscal Year 2014” table for more information.

17


Equity Grants to Directors During Fiscal Year 2014
The following table shows each RSU grant made to each of our directors, other than Mr. Smith, during fiscal 2014, including the grant date, number of shares, and grant date fair value.
 
 
Stock Awards
Director Name
 
Grant Date
 
Shares Subject to Award (#)
 
Grant Date Fair Value
($)(1)
Christopher W. Brody
 
1/24/2014
 
3,550

(2)
260,002

William V. Campbell
 
1/24/2014
 
3,550

(3)
260,002

Scott D. Cook
 
 
 

 

Diane B. Greene
 
1/24/2014
 
3,550

(2)
260,002

Edward A. Kangas
 
1/24/2014
 
3,550

(2)
260,002

Edward A. Kangas
 
1/24/2014
 
1,638

(4)
119,967

Suzanne Nora Johnson
 
1/24/2014
 
3,550

(2)
260,002

Dennis D. Powell
 
1/24/2014
 
3,550

(2)
260,002

Jeff Weiner
 
1/24/2014
 
3,550

(2)
260,002


_______________________________________
(1)
These amounts represent the aggregate grant date fair value of these awards computed in accordance with FASB ASC Topic 718 assuming no forfeitures. The grant date fair value of these awards is equal to the closing market price of Intuit’s common stock on the date of grant. See Intuit’s Annual Report on Form 10-K for the fiscal year ended July 31, 2014 for more information on the valuation of RSUs.
(2)
Annual Non-Employee Board Member grant which, subject to the director’s continued service, vests as to 100% of the shares on January 1, 2015.
(3)
Annual Chairman of the Board grant which, subject to the director’s continued service, vests as to 100% of the shares on January 1, 2015.
(4)
Represents RSUs awarded pursuant to a Conversion Grant (described below under “Annual Retainer and Equity Compensation Program for Non-Employee Directors”) for shares equivalent in fair value on the date of grant to Mr. Kangas’ annual retainers for Board and Committee service for calendar 2014.
Outstanding Equity Awards for Directors at Fiscal Year-End 2014 (Exercisable and Unexercisable)
The following table provides information on the outstanding equity awards held by our directors, other than Mr. Smith, as of July 31, 2014.

 
 
Aggregate Shares
Subject to Outstanding
Director Name
 
Stock
Awards (#)
 
Option
Awards (#)
Christopher W. Brody
 
13,405

(1)
112,500

William V. Campbell
 
12,187

(2)

Scott D. Cook
 

 

Diane B. Greene
 
13,405

(3)
60,000

Edward A. Kangas
 
18,166

(4)
57,500

Suzanne Nora Johnson
 
12,187

(5)
75,000

Dennis D. Powell
 
12,187

(6)
80,000

Jeff Weiner
 
13,567

(7)

_______________________________________

(1) Includes 5,772 vested RSUs for which Mr. Brody has elected to defer settlement and 4,083 vested RSUs on which settlement is deferred in accordance with Intuit’s Director Equity Compensation Plan.

18


(2) Includes 4,554 vested RSUs for which Mr. Campbell has elected to defer settlement and 4,083 vested RSUs on which settlement is deferred in accordance with Intuit’s Director Equity Compensation Plan.
(3) Includes 5,772 vested RSUs for which Ms. Greene has elected to defer settlement and 4,083 vested RSUs on which settlement is deferred in accordance with Intuit’s Director Equity Compensation Plan.
(4) Includes 10,123 vested RSUs for which Mr. Kangas has elected to defer settlement and 4,083 vested RSUs on which settlement is deferred in accordance with Intuit’s Director Equity Compensation Plan.
(5) Includes 4,554 vested RSUs for which Ms. Johnson has elected to defer settlement and 4,083 vested RSUs on which settlement is deferred in accordance with Intuit’s Director Equity Compensation Plan.
(6) Includes 4,554 vested RSUs for which Mr. Powell has elected to defer settlement and 4,083 vested RSUs on which settlement is deferred in accordance with Intuit’s Director Equity Compensation Plan.
(7) Includes 5,934 vested RSUs for which Mr. Weiner has elected to defer settlement and 4,083 vested RSUs on which settlement is deferred in accordance with Intuit’s Director Equity Compensation Plan.

Annual Retainer and Equity Compensation Program for Non-Employee Directors
The Compensation Committee periodically reviews best practices and considers how the Company’s compensation program for non-employee directors compares to the programs of its compensation peers. In conducting this review, the Compensation Committee relies upon information provided to it by FW Cook. The current compensation program approved by our Board for our non-employee directors and the Chairman of the Board has been in effect since January 2012, with the exception of an increase in the stipend for the Compensation Committee Chair from $17,500 to $20,000 effective January 2014 and the increase in the annual cash stipend paid to the Chairman of the Board in lieu of participation in the non-employee director cash compensation program from $240,000 for calendar year 2013 to $260,000 effective January 2014.
Annual Retainer
Non-employee directors are paid annual cash retainers for Board membership, plus additional cash retainers for their committee service in the amounts indicated in the following table:
Position
 
Annual Amount ($)
Non-Employee Board Member
 
60,000

Members of each of Audit and Risk Committee, Acquisition Committee, and Compensation and Organizational Development Committee
 
15,000

Members of the Nominating and Governance Committee
 
10,000

Audit and Risk Committee Chair*
 
32,500

Compensation and Organizational Development Committee Chair*
 
20,000

Acquisition Committee and Nominating and Governance Committee Chairs*
 
17,500


* Committee chair retainers are in addition to committee membership retainers.

These annual retainers are paid in quarterly installments and are pro-rated for any changes to a committee that occurs during any quarter. Directors may elect to defer cash retainers into additional tax-deferred Intuit stock units by making an irrevocable written election prior to the start of each calendar year. Such tax-deferred stock units, known as Conversion Grants, vest in four installments, commencing on the grant date (which is the first business day following the Company’s annual meeting of stockholders) and quarterly thereafter, and will be distributable at the earlier of (i) five years from the date of grant, (ii) separation from the Board, or (iii) a change in control of the ownership of Intuit. We reimburse non-employee directors for out-of-pocket expenses incurred in connection with attending Board and committee meetings.

Director Equity Compensation Program

Grants are made to non-employee directors and the Chairman of the Board in the form of a fixed dollar value of RSUs in the following amounts:
Board Position
 
Fixed Amount of Award ($)
Non-Employee Board Member and Chairman (annual grant)
 
260,000

New Board Member (additional grant upon joining Board)
 
75,000


19



Because the formula is based on a fixed dollar amount, the number of RSUs awarded annually to non-employee directors and the Chairman of the Board may vary, depending on the closing market price of Intuit’s common stock on the date of grant. The annual grants will be awarded on the day following each Annual Meeting of Stockholders. For a new Board Member, the annual grant will be prorated based on the number of full months of expected service until the next Annual Meeting of Stockholders. Subject to the director’s continued service, vesting of the annual RSU grants will occur on the first day of the twelfth month following the date of grant. For example, for grants made in January 2015, the vesting date would occur on January 1, 2016. A new Board Member’s additional grant will vest in two equal installments over two years. Once RSUs vest, settlement of the awards must be deferred until the earlier of (i) five years from the date of grant, (ii) separation from the Board, or (iii) a change in control of Intuit. Directors may defer settlement of their RSUs for a longer period of time at their option.
Board Members receive dividend equivalent rights in conjunction with RSU awards granted in July 2012 and thereafter. RSUs accrue dividends, which will be paid when the shares are issued.
Director Stock Ownership Requirement
    
Each director is required to hold shares of Intuit common stock with an aggregate value of five times the amount of the annual Board member retainer, which value will be measured as of July 31st of each year. Unvested RSUs and deferred RSUs held by a Board member are counted as shares when determining the number of shares owned. Directors must comply with the new guidelines within five years after the date the director joins the Board, or July 2016, whichever is later. If any director does not meet the stock ownership requirement within the designated time frame, 50% of his or her annual cash retainers will be made in the form of Intuit stock until compliance is achieved. As of July 31, 2014, each of the current directors is in compliance with this stock ownership requirement.
PROPOSAL NO. 2
RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Intuit’s Audit and Risk Committee has selected Ernst & Young LLP as the independent registered public accounting firm to perform the audit of Intuit’s consolidated financial statements and the effectiveness of internal control over financial reporting for the fiscal year ending July 31, 2015. As a matter of good corporate governance we are asking stockholders to ratify this selection. Representatives of Ernst & Young are expected to attend the Meeting. They will have the opportunity to make a statement at the Meeting if they wish to do so and will be available to respond to appropriate questions from stockholders. If the selection of Ernst & Young is not ratified, the Audit and Risk Committee will consider whether it should select another independent registered public accounting firm.

The Audit and Risk Committee’s Policy on Pre-Approval of Services Performed by the Independent Registered Public Accounting Firm
It is the policy of the Audit and Risk Committee to pre-approve near the beginning of each fiscal year all audit and permissible non-audit services to be provided by the independent registered public accounting firm during that fiscal year. The Audit and Risk Committee authorizes specific projects within categories of services, subject to a budget for each project. The Audit and Risk Committee may also pre-approve particular services during the fiscal year on a case-by-case basis. The independent auditor and management periodically report to the Audit and Risk Committee the actual fees incurred versus the pre-approved budget.
Fees Paid to Ernst & Young LLP
The following table shows fees that we paid (or accrued) for professional services rendered by Ernst & Young for fiscal 2014 and 2013:

Fee Category
 
Fiscal
2014
 
Fiscal
2013
Audit Fees
 
$
3,613,000

 
$
3,565,000

Audit-Related Fees
 
926,000

 
970,000

Tax Fees
 

 

All Other Fees
 

 

Total Fees
 
$
4,539,000

 
$
4,535,000


20


Audit Fees
These fees consist of amounts for professional services rendered in connection with the integrated audit of our financial statements and internal control over financial reporting, review of the interim financial statements included in quarterly reports, and statutory and regulatory filings or engagements.
Audit-Related Fees
Audit-related fees consist of fees for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements. For fiscal 2014, audit-related fees consisted primarily of fees for services related to the divestiture of our Intuit Financial Services (“IFS”) business. For fiscal 2013, audit-related fees consisted primarily of fees for a review of the IFS service organization controls in accordance with Statement on Standards for Attestation Engagements (SSAE) No. 16 and fees for services related to the divestiture of IFS.
Tax Fees
Intuit paid no tax fees to Ernst & Young in fiscal 2014 or fiscal 2013.
All Other Fees
Intuit paid no other fees to Ernst & Young in fiscal 2014 or fiscal 2013.
For more information about Ernst & Young, please see the “Audit and Risk Committee Report” on page 22.
Approval of this Proposal No. 2 requires the affirmative vote of the majority of the shares of common stock entitled to vote on this proposal that are present in person or represented by proxy at the Meeting and are voted “for” or “against” the proposal. Abstentions and broker non-votes will not affect the outcome of the vote on this proposal.
The Board recommends that you vote
FOR the ratification of the selection of Ernst & Young LLP.



21



AUDIT AND RISK COMMITTEE REPORT
We, the members of the Audit and Risk Committee, assist the Board in fulfilling its responsibilities by overseeing Intuit’s accounting and financial reporting processes, the qualifications, independence and performance of Intuit’s independent auditor, the performance of Intuit’s internal audit department and Intuit’s internal controls. We also are responsible for selecting, evaluating and setting the compensation of Intuit’s independent auditor. Intuit’s management is responsible for the preparation, presentation and integrity of Intuit’s financial statements, including setting accounting and financial reporting principles and designing Intuit’s system of internal control over financial reporting. The Audit and Risk Committee has selected the independent registered public accounting firm of Ernst & Young LLP as Intuit’s independent auditor, with responsibility for performing an independent audit of Intuit’s consolidated financial statements and for expressing opinions on the conformity of Intuit’s audited financial statements with generally accepted accounting principles and on the effectiveness of Intuit’s internal control over financial reporting based on their audit. The Audit and Risk Committee oversees the processes, although members of the Audit and Risk Committee are not engaged in the practice of auditing or accounting.
During the fiscal year ended July 31, 2014, the Audit and Risk Committee carried out the duties and responsibilities as outlined in its charter, including the following specific actions:
Reviewed and discussed with management and the independent auditor Intuit’s quarterly earnings announcements, consolidated financial statements, and related periodic reports filed with the SEC;
Reviewed with management its assessment of the effectiveness of Intuit’s internal control over financial reporting;
Reviewed with the independent auditor and management the audit scope and plan;
Reviewed the internal audit plan with the internal auditor; and
Met in periodic executive sessions with each of the independent auditor, representatives of management, and the internal auditor.
We reviewed and discussed with management and representatives of Ernst & Young the audited financial statements for the fiscal year ended July 31, 2014 and Ernst & Young’s opinion on the audited financial statements and the effectiveness of Intuit’s internal control over financial reporting. Ernst & Young represented that its presentations included the matters required to be discussed with the Audit and Risk Committee by applicable auditing standards of the Public Company Accounting Oversight Board (PCAOB).
The Audit and Risk Committee recognizes the importance of maintaining the independence of Intuit’s independent auditor, both in fact and appearance. Consistent with its charter, the Audit and Risk Committee has evaluated Ernst & Young’s qualifications, independence and performance. The Audit and Risk Committee has concluded that provision of the services described in that section is compatible with maintaining the independence of Ernst & Young. In addition, we have received the written disclosures and the letter from Ernst & Young required by applicable requirements of the PCAOB regarding Ernst & Young’s communications with us concerning independence and discussed with Ernst & Young the firm’s independence.
Based on the reports, discussions and review described in this report, and subject to the limitations on our role and responsibilities referred to in this report and in the charter, we recommended to the Board that the audited financial statements be included in Intuit’s Annual Report on Form 10-K for fiscal 2014. We also selected Ernst & Young LLP as Intuit’s independent registered public accounting firm for fiscal 2015.
AUDIT AND RISK COMMITTEE MEMBERS
Dennis D. Powell (Chair)
Diane B. Greene
Suzanne Nora Johnson

22


TRANSACTIONS WITH RELATED PERSONS
The Audit and Risk Committee is responsible for review, and approval or ratification as appropriate, of specific transactions between Intuit (or its subsidiaries) in which a “related person” has a direct or indirect material interest. Under SEC rules, “related persons” include directors, officers, nominees for director, 5% stockholders, and their immediate family members. The Audit and Risk Committee adopted a written set of procedures and guidelines, which are described below, to evaluate these transactions and obtain approval or ratification by the Audit and Risk Committee.
Identification of Related Persons.  Information about our directors and executive officers and persons related to them is collected and updated through annual Director & Officer Questionnaires and quarterly director affiliation summaries. Directors and executives provide the names of the entities with which they are affiliated, including board memberships, executive officer positions, charitable organizations, and affiliations of immediate family members.
Audit and Risk Committee Annual Pre-Approval.  On an annual basis, Intuit’s procurement and legal departments prepare requests for pre-approval of transactions or relationships involving related persons or parties with which Intuit is expected to do business during the upcoming fiscal year. The Audit and Risk Committee reviews these requests during its regular fourth quarter meeting and generally pre-approves annual spending levels for each transaction or relationship.
Periodic Approvals.  During the year, the list of known related persons is circulated to appropriate Intuit employees and is used to identify transactions with related persons. When Intuit identifies an actual or potential transaction with a related person that was not pre-approved by the Audit and Risk Committee, Intuit’s legal department collects information regarding the transaction, including the identity of the other party, the value of the transaction, and the size and significance of the transaction to both Intuit and the other party. This information is provided to the Audit and Risk Committee, which in its discretion may approve, ratify, rescind, place conditions upon, or take any other action with respect to the transaction.
Monitoring of Approved Transactions and Relationships.  Following approval by the Audit and Risk Committee, Intuit personnel review and monitor the transactions and relationships from time to time. If spending levels approach the limits approved by the Audit and Risk Committee, Intuit prepares and submits a new approval request to the Audit and Risk Committee for review at its next meeting.
Compensation Decisions.  The Audit and Risk Committee generally does not review executive or director compensation transactions or arrangements, as these are approved by the Compensation Committee or the Board, as appropriate.
Since the beginning of fiscal 2014, there have been no transactions and there currently are no proposed transactions in excess of $120,000 between Intuit (or its subsidiaries) and a related person in which the related person had or will have a direct or indirect material interest.

23


PROPOSAL NO. 3
ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION
In accordance with Section 14A of the Securities Exchange Act of 1934, as amended, we are asking stockholders to approve the following advisory resolution at the Meeting:
RESOLVED, that the compensation paid to the Company’s Named Executive Officers, as disclosed in this proxy statement pursuant to the SEC’s executive compensation disclosure rules (which disclosure includes the Compensation Discussion and Analysis, the compensation tables and the narrative discussion that accompanies the compensation tables), is hereby approved.
As described in the “Compensation Discussion and Analysis” section of this proxy statement, the guiding philosophy of the Compensation Committee is to establish a compensation program that is designed to compensate our executives based on both overall Company performance and individual employee performance; help achieve our corporate growth strategy; acquire, retain and motivate talented executives with proven experience; and have a greater portion of Named Executive Officer pay tied to short- and long-term incentive programs than most other Intuit employees, because they lead our key business units or functions, and thus have the ability to directly influence overall company performance.
Intuit employs a number of practices that reflect our pay-for-performance compensation philosophy, including:
a significant portion of our senior executive officer compensation is in the form of performance-based incentives, and in fiscal 2014, 50% of equity incentive value was granted in the form of performance-based RSUs, which measure relative TSR compared to a peer group;
we do not provide special retirement benefits designed solely for executive officers;
we do not provide any excise tax “gross-up” payments;
we do not provide perquisites or other executive benefits based solely on rank;
we prohibit directors and executive officers from pledging Intuit stock and engaging in hedging transactions involving Intuit stock;
we have “clawback” provisions for operating performance-based equity awards; and
we have stock ownership guidelines for executive officers at the senior vice president level and above and non-employee directors, with the CEO guideline set at six times salary, the senior vice president level and above guideline set at one and a half times salary, and non-employee director guideline set at five times retainer.
Stockholders are urged to read the “Compensation Discussion and Analysis” section of this proxy statement, which discusses how our executive compensation policies and practices implement our compensation philosophy, and the “Executive Compensation” section of this proxy statement, which contains tabular information and narrative discussion about the compensation of our Named Executive Officers. The Compensation Committee and the Board believe that these policies and procedures are effective in implementing our compensation philosophy and in achieving its goals.
While the advisory vote to approve executive compensation is non-binding, the Compensation Committee, which is responsible for designing and administering our executive compensation program, values the opinions expressed by stockholders in their vote on this proposal, and will consider the outcome of the vote when making future compensation decisions for named executive officers.
We will continue to hold our say on pay votes on an annual basis until the next vote on the frequency of advisory votes, unless the Board of Directors modifies its policy prior to that time. A non-binding advisory vote on our executive compensation program will again be included in our proxy statement next year.
The Board recommends that you vote
FOR approval of the advisory resolution to approve executive compensation.



24



COMPENSATION AND ORGANIZATIONAL DEVELOPMENT COMMITTEE REPORT
Set out below is the Compensation Discussion and Analysis, which is a discussion of Intuit’s executive compensation programs and policies written from the perspective of how we and management view and use such policies and programs. We strive to see that Intuit’s compensation programs are fiscally responsible, market responsive and performance based. Guided by these principles, we regularly review and monitor senior management’s compensation, as well as their potential for larger leadership roles, to produce the greatest value for Intuit’s three stakeholders — employees, customers and stockholders. To this end, the Compensation and Organizational Development Committee has reviewed the components of compensation paid to each of Intuit’s officers for fiscal 2014, including annual base salary, target incentive bonus and equity compensation.
Given our role in providing guidance on program design, administering those programs and policies, and in making specific compensation decisions for senior executives, the Compensation and Organizational Development Committee participated in the preparation of the “Compensation Discussion and Analysis” and reviewed and discussed the “Compensation Discussion and Analysis” with management. Based on the review and discussions, we recommended to the Board that the “Compensation Discussion and Analysis” be included in this proxy statement.
COMPENSATION AND ORGANIZATIONAL
DEVELOPMENT COMMITTEE MEMBERS
Edward A. Kangas (Chair)
Christopher W. Brody
Jeff Weiner


25


COMPENSATION DISCUSSION AND ANALYSIS
The Compensation and Organizational Development Committee (the “Compensation Committee”) oversees Intuit’s compensation plans and policies, approves compensation of our executive officers and administers our equity compensation plans. This Compensation Discussion and Analysis (“CD&A”) contains context for the compensation actions approved by the Compensation Committee and paid for fiscal 2014 to the executive officers named below (the “Named Executive Officers”) and included in the “Summary Compensation Table” on page 45:
Brad D. Smith, President and Chief Executive Officer
R. Neil Williams, Senior Vice President and Chief Financial Officer
Laura A. Fennell, Senior Vice President, General Counsel and Corporate Secretary
Sasan K. Goodarzi, Senior Vice President and General Manager, Consumer Tax Group
Daniel A. Wernikoff, Senior Vice President and General Manager, Small Business Group
Executive Summary
Intuit is strongly committed to pay for performance. To that end, our executive compensation programs are designed to reward both short- and long-term growth, as well as total stockholder return (“TSR”). Our short-term performance-based compensation consists of annual cash bonuses, which are based upon achievement of annual corporate operating goals, including revenue and non-GAAP operating income growth, and individual performance. Our fiscal 2014 long-term compensation consists of performance-based RSUs based on relative total stockholder return (“Relative TSR RSUs”), RSUs and non-qualified stock options.
Fiscal 2014 Business Highlights
Intuit achieved revenue growth of 8.0%, non-GAAP operating income growth of 6.9% and non-GAAP earnings per share (“EPS”) growth of 10.0% (see table on page A-3 of this proxy statement for a reconciliation of non-GAAP financial measures) and a TSR of 29.5%. These results take into account both an acceleration to cloud-based subscriptions, which shifted some fiscal 2014 revenue into future reporting periods, and expenses associated with a restructuring in the fourth quarter of fiscal 2014. In August 2014, Intuit announced a strategic decision to begin recognizing desktop product revenue over time, as opposed to up front at the time of purchase. We expect this decision to delay the recognition of both revenue and operating income that otherwise would have been realized in fiscal 2015 to future periods.
Our revenue, operating income and earnings per share for fiscal 2014 were at the high end of our guidance range, after adjusting for the impact of the related restructuring charges.     
Key highlights from fiscal 2014 include the following:
Our revenue for fiscal 2014 was $4.506 billion, and adjusting for the impact of the restructuring charges described above, non-GAAP operating income was $1.597 billion and non-GAAP diluted EPS was $3.58, compared to revenue guidance of $4.475 billion to $4.505 billion, non-GAAP operating income guidance of $1.58 billion to $1.6 billion and non-GAAP diluted EPS guidance of $3.54 to $3.58;
Revenue for our Consumer Tax Group exceeded expectations by growing 7% for the year versus guidance range of 4% to 5% percent;
Our Professional Tax and Consumer Ecosystem businesses each exceeded internal plans and external guidance, with revenue growth of 4% and 8% percent, respectively;
Small Business Group revenue increased 10% for the year, and within the Small Business Group, the Small Business Online Ecosystem grew subscribers and improved attach rates for additional services;
We closed fiscal 2014 with nearly 700,000 QuickBooks Online customers, and more than 1 million total QuickBooks subscribers;
We increased QuickBooks online subscriptions by 40% and TurboTax online subscriptions by 14%;
We completed ten acquisitions, adding talent and technology across the small business and consumer ecosystems;
Intuit continued its disciplined financial strategy, focusing on cash management and maintaining a strong balance sheet; and

26


Our employee engagement scores continued to reflect best-in-class levels; Intuit moved up 14 places to number eight in Fortune’s “Top 100 Places to Work” survey and average customer satisfaction scores improved.
Intuit’s TSR has performed well in recent years. Measured at the end of fiscal 2014, we delivered one-year TSR of 29.5%, three-year annualized TSR of 21.9% and five-year annualized TSR of 23.3%, closing the year with our stock price at an all-time high. The graph below compares the cumulative TSR on Intuit common stock for the last five full fiscal years with the cumulative total returns on the S&P 500 Index and the Morgan Stanley Technology Index for the same period. It assumes that $100 was invested in Intuit common stock and in each of the other indices on July 31, 2009 and that all dividends were reinvested (Intuit did not pay cash dividends prior to fiscal 2012). Over this five-year period, Intuit’s TSR exceeded both the broad market (as evidenced by a comparison against the S&P 500 Index) and the overall technology sector (as evidenced by a comparison against the Morgan Stanley Technology Index). The comparisons in the graph below are based on historical data – with Intuit common stock prices based on the closing price on the dates indicated – and are not intended to forecast the possible future performance of Intuit’s common stock.

Compensation Practices
Intuit employs a number of practices that reflect our pay-for-performance compensation philosophy and are intended to provide total compensation that is competitive and related to both Intuit’s and individual performance:
A significant portion of our fiscal 2014 senior executive officer compensation is in the form of incentives tied to achievement of particular performance measures. In addition to our annual cash bonus, 50% of equity incentive value was granted in the form of performance-based RSUs, which measure relative TSR against a group of other software and services companies of comparable size. The remaining 50% of equity incentive value was granted in the form of RSUs (which incorporate a one-year GAAP operating income hurdle) and stock options, both of which the Compensation Committee also considers to be performance-based compensation;
We do not provide supplemental company-paid retirement benefits designed for executive officers;
We do not provide any excise tax “gross-up” payments;

27


We do not provide perquisites or other executive benefits based solely on rank;
We prohibit directors and executive officers from pledging Intuit stock and engaging in hedging transactions involving Intuit stock;
We have “clawback” provisions for operating performance based equity awards; and
We have stock ownership guidelines for executive officers at the senior vice president level and above and non-employee directors, with the CEO guideline set at six times his base salary.
As illustrated below, approximately 94% of target total direct compensation for Mr. Smith in fiscal 2014 was performance-based, consisting of 85% equity and 9% target annual cash bonus. Only base salary, which is 6% of his total target compensation, was fixed, ensuring a strong link between his target total direct compensation and the Company’s results.

CEO Performance and Incentive Pay Mix – Target Total Direct Compensation


28


The majority of executive compensation for our Named Executive Officers is delivered through programs that link pay realized by executive officers with financial and operational results and with TSR. Incentive payouts under our Senior Executive Incentive Plan were based on revenue growth, operating income growth, business unit or functional group performance and individual performance. Equity-based compensation consisting of Relative TSR RSUs, RSUs and non-qualified stock options align compensation with the long-term interests of Intuit’s stockholders by focusing our executive officers’ performance on both absolute and relative TSR. The following chart shows the allocation of the Named Executive Officers’ actual total direct compensation for fiscal 2014, reflecting the extent to which their actual total direct compensation consists of performance-based compensation.
(1) Equity awards are reported at grant date fair value, which, for the Relative TSR RSUs, is based on the target number of shares subject to the award.
2014 “Say on Pay” Advisory Vote on Executive Compensation
Intuit has provided stockholders with an advisory vote on executive compensation in each of the last four years. At our 2014 Annual Meeting of Stockholders, approximately 82% of the votes cast in the “say on pay” advisory vote were “FOR” approval of our executive compensation. The Compensation Committee evaluated the results of the 2014 advisory vote together with the other factors and data discussed in the CD&A in determining executive compensation policies and decisions. The Committee did not make any material changes to our overall fiscal 2014 executive compensation policies and decisions as a result of the 2014 advisory vote. We value the opinions of our stockholders and will continue to consider the outcome of future say on pay votes when designing our compensation programs and policies and making compensation decisions for our Named Executive Officers.
Compensation Philosophy and Objectives
In setting policies and practices regarding compensation, the guiding philosophy of the Compensation Committee is to establish a compensation program that is designed to:
compensate our executives based on both Company performance and individual performance;
help achieve our corporate growth strategy;
acquire, retain and motivate talented executives with proven experience in a competitive market; and
have a greater portion of Named Executive Officer pay opportunity tied to short- and long-term incentive programs than most other Intuit employees, because they lead our key business units or functions and thus have the ability to directly influence overall Company performance.
The Compensation Committee believes that a mix of both cash and equity incentives is an effective compensation structure, as annual cash incentives reward executives for near term operating results, while equity incentives motivate executives to execute on our long-term strategic plan in order to increase stockholder value. In determining the amount of the cash and equity incentives, the Compensation Committee considers each officer’s total compensation on both a short- and long-

29


term basis to assess the retentive and incentive value of his or her overall compensation, while taking into consideration additional relevant factors, including, for example, market data, internal parity and stockholder and proxy advisor perspectives.
We manage equity compensation to provide competitive rewards that are commensurate with results delivered, while limiting dilution to stockholders.
Specific Elements of Fiscal 2014 Compensation
Compensation for all Named Executive Officers is a mix of the principal components summarized in the following table and described in greater detail below.

Component of Compensation
 
Primary Purpose
 
 
 
Base Salary
 
Provide the security of a competitive fixed cash payment for services rendered
Annual Bonus
 
Reward achievement of annual company financial performance and individual strategic and operational objectives
Stock Options

 
Retain and motivate executives to build stockholder value over the life of the option, since options deliver value only if Intuit’s stock price appreciates after grant
Restricted Stock Units

 
Retain executives and provide alignment with stockholders’ interests during the vesting term
Relative TSR RSUs
 
Retain and align executives with stockholders for a minimum of three years and offer upside for strong positive returns to stockholders relative to similar alternative investments over 12, 24 and 36 month periods
The Compensation Committee conducts its annual review process near the end of each fiscal year to determine each executive’s cash bonus, equity awards and any adjustments to base salary and target cash bonus opportunities for the following year. This timing allows the Company’s financial results for the fiscal year to be taken into account when making officer compensation decisions.
Base Salary
Base salaries provide the security of a fixed cash payment for services rendered. In July 2014, the Compensation Committee reviewed the base salaries of our Named Executive Officers in the context of the compensation information provided by FW Cook, the Compensation Committee’s independent compensation consultant, to determine whether the base salaries of our Named Executive Officers were competitive with our compensation peer group and to ensure those salaries reflect each executive’s roles, responsibilities, experience and performance as further described under “Use of Competitive Data” on page 40. The Compensation Committee decided to maintain the base salaries of Messrs. Smith and Williams and Ms. Fennell at the fiscal 2014 level for fiscal 2015. The Compensation Committee approved increases in the fiscal 2015 base salaries of Mr. Goodarzi and Mr. Wernikoff as follows:
Mr. Goodarzi’s base salary was increased by 4.8% to $650,000 in recognition of his outstanding performance in fiscal 2014 and his demonstrated ability to drive change within Intuit’s Consumer Tax organization; and
Mr. Wernikoff’s base salary was increased by 14.2% to $600,000, in recognition of his increase in responsibility leading the Company’s Small Business Group, a business with revenue of over $2 billion in fiscal 2014, while prior to April 2014, he handled the Company’s Small Business Financial Solutions Group, a business responsible for approximately $1.4 billion in revenue in fiscal 2014.
Annual Cash Bonuses
Intuit uses cash bonuses to reward achievement of annual Company financial performance and individual strategic and operational objectives, all of which align with stockholder value. All employees (other than those eligible to participate in certain sales and customer care incentive programs), including each of Intuit’s Named Executive Officers, have an annual bonus target that is a stated percentage of base salary determined by the individual’s role within Intuit. Bonus targets for the Named Executive Officers were set by the Compensation Committee based on the scope and significance of each executive’s leadership role at Intuit, and a review of market data. The target amounts are used as a starting point in the determination of cash bonuses, but actual bonus payments varied based on Company and individual performance, as discussed below.

30


A Company-wide bonus pool is funded out of Intuit’s operating income and is paid out through certain incentive plans to all employees. Cash bonuses for our Named Executive Officers are paid out under the Senior Executive Incentive Plan (“SEIP”), a stockholder-approved plan designed to provide for payments that qualify as performance-based compensation under Section 162(m).
Funding of the Company’s bonus plans, including the SEIP, is based on Company performance against specific revenue and operating income targets, as described in more detail below. The fiscal 2014 bonus pool was allocated across Intuit’s business units and functional groups based on the CEO’s assessment of each group’s performance during the year. Within the context of both Company and business unit/functional group performance, managers distributed the funded pool based on individual performance.
Each year, the Compensation Committee sets a Company performance target which must be achieved in order for any employee to be eligible to receive a cash bonus under the SEIP. At the close of fiscal 2014, the Compensation Committee certified that Intuit had exceeded the operating income threshold set at $600 million and thus each participant in the SEIP was eligible, but not entitled, to receive a cash bonus under that plan.
Fiscal 2014 Company-wide Bonus Pool Funding
The baseline funding of the Company-wide fiscal 2014 bonus pool was based on Intuit’s revenue growth and non-GAAP operating income growth (see table on page A-3 of this proxy statement for a reconciliation of non-GAAP measures), as set forth on the following table. Both measures were weighted equally because the Compensation Committee believes that annual profitable growth sustained over time translates into durable value creation for stockholders.
All employees (other than those eligible to participate in certain sales and customer care incentive programs), including but not limited to the Named Executive Officers, are eligible to participate in this Company-wide pool. The Compensation Committee has discretion to adjust the formulaic funding level up or down by 30 percentage points, taking into account qualitative factors that measure management’s success in building a stronger foundation for the future by improving outcomes for stockholders, employees and customers, macro-economic conditions and the Company’s performance relative to its peers, as well as extraordinary items which impacted financial results but are not a reflection of Intuit’s operating performance.

31



The following table reflects the goals approved by the Committee for purposes of calculating the baseline funding of the Company-wide bonus pool, as well as the Company’s actual performance results.

Measure
 
Revenue Growth
 
Non-GAAP Operating Income Growth
 
Total
 
 
 
 
 
 
 
 
 
 
 
Weighting
 
50%
+
50%
=
100%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Baseline
 
 
 
 
Bonus
 
FY14
 
Bonus
 
Company
 
 
FY14
 
Pool Funding
 
Operating
 
Pool Funding
 
Performance
 
 
Revenue
 
as a Percent
 
Income
 
as a Percent
 
as a Percent
 
 
Growth
 
of Target*
 
Growth
 
of Target*
 
of Target(1)
Maximum
 
11.4%
 
150%
 
11.5%
 
150%
 
150%
 
 
10.7%
 
133%
 
10.7%
 
133%
 
133%
 
 
9.9%
 
117%
 
9.9%
 
117%
 
117%
Target
 
9.1%
 
100%
 
9.2%
 
100%
 
100%
 
 
8.5%
 
95%
 
8.5%
 
95%
 
95%
 
 
 
 
 
 
7.8%
 
90%
 
90%
Actual
 
8.0%
 
91.8%
 
6.9%
 
79.7%
 
85.8%
 
 
7.8%
 
90%
 
 
 
 
 
 
 
 
6.5%
 
75%
 
6.5%
 
75%
 
75%
 
 
5.2%
 
60%
 
5.2%
 
60%
 
60%
 
 
3.9%
 
45%
 
3.9%
 
45%
 
45%
 
 
2.6%
 
30%
 
2.6%
 
30%
 
30%
 
 
1.3%
 
15%
 
1.3%
 
15%
 
15%
Threshold
 
—%
 
—%
 
—%
 
—%
 
—%

______________________________________
* Linear interpolation between defined points.
(1) This represents a baseline for the funding of the company-wide bonus pool. The Compensation Committee has discretion to adjust the actual funding level up or down by 3000 basis points. As discussed below, the Committee used its discretion to fund the Company Performance Component at 100% of target.
The baseline funding of the Company-wide bonus pool was calculated to be 85.8% of Target based on the Company’s revenue growth of 8.0% and non-GAAP operating income growth of 6.9% in fiscal 2014. The Compensation Committee determined it was appropriate to exclude certain charges, primarily related to the fourth quarter Small Business Group restructuring efforts, when determining the appropriate level of funding of the Company-wide bonus pool because they did not reflect the Company’s core operations. Without these charges, the baseline funding of the Company-wide pool would have been 89.5% of Target.
The Compensation Committee also considered the Company’s performance against factors that we call our “True North” criteria - delivering the best possible results in the current period for employees, customers and stockholders, while building the foundation for a stronger future - and determined that Intuit had a strong year and the Company made important strategic decisions which the Committee believes will help build a foundation for continued strong performance in future years, by achieving the following outcomes for stockholders, employees and customers:
Employee engagement scores remained at best-in-class levels, as measured by an independent third party;
Improved the Company’s rank by 14 places to number eight on Fortune magazine’s “Great Place to Work” survey;
Ranked #3 on Fortune magazine’s “Most Admired Software Company” survey;

32


Held or gained share in most major product lines;
Accelerated adoption of cloud solutions, both for small businesses and Turbo Tax online;
Achieved strong growth in the Consumer Tax Group, ProTax Group and Consumer Ecosystem; and
Continued to grow stock price, outperforming both the S&P 500 Index and the Morgan Stanley Technology Index.
Based on a review of the Company’s performance against our True North criteria, the Compensation Committee determined to set the actual Company-wide bonus pool, which includes SEIP funding, at 100%.
Determination of Cash Bonuses
Eligible employees, including our Named Executive Officers, received bonuses from the Company-wide bonus pool, and other than for Mr. Smith, such bonuses were based on their applicable business unit or functional group’s performance against its own True North criteria as well as their own performance, as evaluated by the Compensation Committee and recommended by the CEO (for all Named Executive Officers except himself), during the fiscal year. Mr. Smith’s incentive award was determined based on full Company results, and not the performance of any particular functional group or business unit, as well as the Committee’s evaluation of his individual performance. The actual bonus payouts to our Named Executive Officers were in the range of 105% to 135% of their individual target bonus.

Brad Smith.  In assessing Mr. Smith’s individual performance and resulting bonus, the Compensation Committee considered his impact on one-year operational and longer-term strategic plans. In particular, the Compensation Committee determined that Mr. Smith had delivered outstanding performance on the following annual operating goals which were established by the Compensation Committee early in fiscal 2014:
Revenue growth
Non-GAAP operating income growth
Leadership results
Build a high performing organization and a great environment for top talent to work:
Maintain high employee engagement (annual survey and related actions) in a competitive talent market
Maintain rigorous talent management efforts (hiring, retention and development - with a specific focus on attracting/retaining top product and technical talent)
Enhance the product and engineering culture by engaging and empowering product, design and tech talent to develop and deliver great products and network effect platforms
Develop a collaborative work environment which empowers individuals at all levels to contribute and execute effectively
Deliver awesome customer experiences that create delight and grow market share:
Uphold the highest customer experience results, focusing on end to end experience including customer care as measured by net promoter scores
Cultivate an innovative culture where teams apply “lean start-up” principles to improve existing and/or build new products that are valued by customers
Build durable advantage in Intuit’s technology and infrastructure that empowers local teams to innovate quickly, increasing effectiveness and efficiency
Develop a systemic process for identifying and capitalizing on inorganic opportunities to strengthen Intuit’s talent, technology and revenue trajectory
In assessing Mr. Smith’s performance against his one-year goals, the Compensation Committee noted the Company’s strong performance in the Consumer Tax, Consumer Ecosystem and Professional Tax groups, as well as the successful execution of the transition towards cloud-based solutions, as demonstrated by growth in QuickBooks Online subscriptions of 40% and TurboTax Online subscriptions of 14%. The Committee also took into account that under Mr. Smith’s leadership, the Company completed ten acquisitions in fiscal 2014, and the Company closed the year with its stock price at an all-time high.

33


The Compensation Committee also determined that Mr. Smith delivered outstanding progress toward the following longer-term goals established by the Compensation Committee early in fiscal 2014:
Long-term strategic plan for Intuit that accelerates our growth track
Articulate a long-term vision and strategic plan (3 years) for the Company
Demonstrate progress against (1) being the operating system behind small business success and (2) doing the nations’ taxes by:
1.
Delivering awesome product experiences:
a.
Amazing first use experiences that deliver the customer benefit much better than competitors
b.
Reimagined mobile first/mobile only, capitalizing on the unique mobile design and capabilities
2.Enabling the contributions of others to build network effect platforms
a.
Solving multi-sided problems well, creating a virtuous circle of end users and contributors
b.
Expanding globally through platforms that are localized by users and developers
3.
Using data to create delight
a.
Enabling customer data to deliver better product experiences and break through benefits
Multi-year leadership strategy and progress
Management growth and succession plans; strong business leaders and pipeline; hiring and retention of key technical talent
Trend for employee engagement results (annual survey and related actions); addressing any specific issues which arise
Trend for customer experience results as measured by customer satisfaction scores
Progress against global expansion strategies
In assessing Mr. Smith’s performance and progress toward these long-term goals, the Compensation Committee determined that under Mr. Smith’s leadership, Intuit made significant progress toward its strategic goals of being the operating system behind small business success and doing the nations’ taxes. By accelerating its shift to cloud-based services, the Company is expanding the total addressable market and can generate more predictable, recurring revenue streams to accelerate future growth. In addition, the Committee noted that the Company has improved its customer acquisition, retention and satisfaction in QuickBooks Online, TurboTax and its ProTax product, contributing to the longer-term business goals. It also recognized Mr. Smith’s achievements with respect to growing and developing the Company’s management team and technical talent, as well as the acceleration of its global growth, all while continuing to maintain best-in-class employee engagement scores and high customer satisfaction scores in several key businesses.
After consulting with the Board without Mr. Smith present, the Compensation Committee determined that his overall performance rating was outstanding. In consideration of this rating, the Compensation Committee determined that Mr. Smith’s bonus would be paid at 135% of target. In making this determination, no individual factor was assigned any specific weight by the Compensation Committee. Rather, the Compensation Committee assessed these factors and their overall impact on the Company and exercised its judgment in setting his bonus. The Committee determined that Mr. Smith’s fiscal 2015 target bonus should be increased to 150% of salary, making an increased portion of his total cash compensation performance-based, which percentage is consistent with the practice of the Company’s compensation peers.
Other Named Executive Officer Bonuses
The Compensation Committee determined the amounts of the bonuses for Intuit’s other Named Executive Officers, based on each executive’s leadership and progress toward one-year operational and longer-term strategic plans. In evaluating executives and determining each of their overall performance ratings, the Compensation Committee considered: (1) the performance evaluation and pay recommendations made by the Chief Executive Officer, which took into account the performance of each executive’s business unit or functional group, the executive’s leadership capability and retention criticality and (2) the scope, degree of difficulty and criticality of the executive’s responsibilities. The Compensation Committee gives considerable weight to the evaluation provided by the Chief Executive Officer because of his direct knowledge of each other

34


Named Executive Officer’s performance and contribution. As with Mr. Smith’s bonus, in determining the individual bonus payouts, no individual factor was assigned any specific weight by the Compensation Committee. Rather, the Compensation Committee assessed these factors and their overall impact on the Company and exercised its judgment in setting the bonuses.
Neil Williams.  The Compensation Committee determined that Mr. Williams had outstanding performance for fiscal 2014. Under his leadership, Intuit’s finance team has continued to build strong partnerships with our business units to achieve excellent results. The Compensation Committee also recognized his leadership of the Company’s corporate strategy and development team, which drove the Company’s ten fiscal 2014 acquisitions, as well as his leadership of the Company’s investor relations team, which enhanced its investor outreach program during the year. The Compensation Committee determined that Mr. Williams’ bonus would be paid out at 120% of target. The Committee determined that Mr. Williams’ fiscal 2015 target bonus should be increased from 75% to 80% of salary, thereby tying a greater percentage of his total cash compensation in the following year to performance and bringing his target bonus percentage more in line with the market.
Laura Fennell. The Compensation Committee determined that Ms. Fennell had outstanding performance in her role leading the Legal, Compliance, Data Services and Policy organization, which includes the Company’s legal, privacy, information security, data services and government affairs organizations. Ms. Fennell demonstrated execution excellence in managing Intuit’s legal affairs and strong leadership in the change management process for the data services and information security teams. The Compensation Committee noted in particular her demonstrated leadership in attracting and retaining key technical leaders in the data services and information security groups. The Compensation Committee determined that Ms. Fennell’s bonus would be paid out at 110% of target. The Committee determined that Ms. Fennell’s fiscal 2015 target bonus should be increased from 65% to 70% of salary, thereby tying a greater percentage of her total cash compensation in the following year to performance and bringing her target bonus percentage more in line with the market.
Sasan Goodarzi. The Compensation Committee determined that Mr. Goodarzi had outstanding performance in his role as the head of Intuit’s Consumer Tax business. Under his leadership, TurboTax gained over two points of market share in fiscal 2014, growing TurboTax Online units 14% and total TurboTax units 10%. Total Consumer Tax Group revenue grew 7%, which exceeded the Company’s guidance of 4% to 5%. Mr. Goodarzi also led the Consumer Tax team to re-envision the business’s offerings, which resulted in improvements to the product’s website traffic, conversion, retention and net promoter scores. The Compensation Committee determined that Mr. Goodarzi’s bonus would be paid out at 130% of target. The Committee also determined that Mr. Goodarzi’s fiscal 2015 target bonus should be increased from 65% to 80% of salary, thereby increasing the amount of his total cash compensation in the following year that is tied to performance and bringing his target bonus percentage more in line with the market.
Daniel Wernikoff. The Compensation Committee determined that Mr. Wernikoff had strong performance in his role as the head of Intuit’s Small Business Financial Services group, and as the leader of the expanded Small Business Group, after the former Small Business Management Services team began reporting into him as well. Under his leadership, the Small Business Group saw accelerated unit growth, increased attach rates, improved net promoter scores and improved customer care performance. The Compensation Committee recognized Mr. Wernikoff’s bold strategic thinking in his new, expanded role, including ongoing improvements in creating a “one SBG” customer experience. The Compensation Committee determined that Mr. Wernikoff’s bonus would be paid out at 105% of target. The Committee also determined that Mr. Wernikoff’s fiscal 2015 target bonus should be increased from 65% to 80% of salary, increasing the amount of his total cash compensation in the following year that is tied to performance and bringing his target bonus percentage more in line with the market.
Fiscal 2014 Long-Term Incentives
In July 2014, the Compensation Committee approved changes to the Company’s long term incentive program in an effort to simplify the program without sacrificing its stockholder performance orientation. For fiscal 2014, Relative TSR RSUs comprised half of the equity value granted to our Named Executive Officers when measured by grant date fair value. The other half is split evenly between RSUs and stock options.
Relative TSR RSUs
In fiscal 2014, Relative TSR RSUs comprised fifty percent of the value of the long-term equity awards. Relative TSR RSUs are earned based on Intuit’s three-year relative TSR compared to a pre-established peer group, with three discrete performance periods covering 12, 24 and 36 months. Shares earned based on the 12- and 24- month performance periods have an additional service-based vesting requirement, such that all of the earned shares cliff vest following the end of the 36-month period. Performance-based awards ensure that a meaningful share of our executives’ equity compensation is contingent upon future performance rather than continued employment or stock appreciation. Further, our Relative TSR RSUs align award holders with stockholders, holding award holders accountable for better than average stockholder return compared to other software companies, and the three year vesting schedule serves as a retention incentive. The use of three discrete 12, 24 and 36 month periods aims to minimize the potential impact of anomalous share price trends over the duration of the three-year

35


performance period that could result from market volatility. The Company believes that this approach focuses Named Executive Officers on long-term stockholder return, which is the goal of sustained multi-year profitable growth and ultimately reflects our stockholders’ perception of our performance
Our TSR peer group was identified using objective selection criteria recommended by FW Cook, its independent compensation consultant, which have been consistently applied for the last four years. All are U.S.-based public companies within Intuit’s General Industry Classification Standard (“GICS”) code that have market capitalization and revenue between 0.2x and 5x Intuit’s size, plus H&R Block, which is a direct, size-relevant competitor (the “TSR Peers”). The TSR Peers were chosen so that the Relative TSR RSUs will reward the Named Executive Officers based on objective measurement of Intuit’s one-, two- and three-year return compared to similar companies in which an Intuit stockholder might reasonably be expected to invest. The Committee believes that having 41 TSR Peers ensures that, in spite of mergers or acquisitions of TSR Peers, the Company will maintain a robust peer group against which it can measure its TSR. There is almost complete overlap with the Company’s peer group, as 20 of the 21 companies in it are also included in the TSR peer group. The stockholder return of both Intuit and the TSR Peers is measured using a thirty trading-day average at the start and the end of each performance period. The purpose of this averaging period is to reduce the effect of daily stock market volatility on the measurement of TSR. There is a “target” payout, which is earned when Intuit’s performance is at the 60th percentile of the peers for the applicable performance period. These payouts may be as high as 200% of target if Intuit’s TSR reaches the 100th percentile of the TSR Peers for the performance period and may be as low as 0% of target if performance is at or below the 30th percentile of the TSR Peers for the performance period. The payouts are capped at 100% of target in the event that Intuit’s relative TSR is above the 60th percentile of the TSR Peers, but absolute TSR is negative over any of the three performance periods, in order to avoid particularly large award earnouts for outperforming peers in falling markets when Intuit’s stockholders do not have a positive return. The table below describes the percent of target that may be earned under these awards based on relative TSR:
 
 
TSR
Percentile
Rank(1)
 
Shares Earned
as a Percent
of Target(2)
Maximum
 
100

 
200
%
Target
 
60

 
100
%
Threshold
 
30

 
%
_______________________________________
(1)
Linear interpolation between defined points.
(2)
Payouts capped at 100% if absolute 3-year TSR is negative.

The 41 Relative TSR Peers are set forth below:
Relative TSR Peer Companies
Activision Blizzard, Inc.
 
Equinix, Inc.
 
Rackspace Hosting, Inc.
Adobe Systems Incorporated
 
Fidelity National Info Services, Inc.
 
Red Hat, Inc.

Akamai Technologies, Inc.
 
Fiserv, Inc.
 
Sabre Corporation
Alliance Data Systems Corporation
 
FleetCor Technologies, Inc.
 
Salesforce.com, Inc.

Autodesk, Inc.
 
Gartner, Inc.
 
Symantec Corporation

Automatic Data Processing, Inc.
 
Global Payments Inc.
 
Synopsys, Inc.

Broadridge Financial Solutions, Inc.
 
H&R Block, Inc.
 
Teradata Corporation

CA, Inc.
 
IAC/InterActiveCorp
 
Total System Services, Inc.
Cadence Design Systems, Inc.
 
Jack Henry & Associates Inc.
 
Verisign, Inc.

Citrix Systems, Inc.
 
 LinkedIn Corporation
 
VMware, Inc.

Cognizant Technology Solutions
 
Mastercard Incorporated
 
The Western Union Company
Computer Sciences Corporation
 
Nuance Communications, Inc.
 
Xerox Corporation
eBay, Inc.
 
Open Text Corporation
 
Yahoo! Inc.
Electronic Arts, Inc.
 
Paychex, Inc.
 
 
One company was removed from the 2013 group because it was acquired (BMC Software, Inc.), while five 2013 TSR peer companies were removed because they no longer met the objective size requirement (Facebook, Inc., Genpact Limited,

36


SAIC, Inc., Tibco Software and Vantiv, Inc.). Four companies were added (Broadridge Financial Solutions, Inc., FleetCor Technologies, Inc., Sabre Corporation and Xerox Corporation) as they met the size and industry criteria set forth above on the date of determination.
RSU Awards
In fiscal 2014, 25% of the total value of the executive officers’ annual equity awards was made in the form of RSUs. RSUs provide a link to stockholders’ interests because their value fluctuates with stock price and they also serve as a long-term incentive for officers to remain with Intuit as they receive no value unless they remain with the Company through the vesting period. In addition, RSUs have a performance component, as the Company must achieve a one-year GAAP operating income hurdle before these RSUs will begin to vest to allow such awards to qualify as performance-based compensation under Section 162(m). RSUs vest over three years, with one-third of the shares vesting in July of each year beginning in 2015, subject to achievement of the one-year GAAP operating income hurdle.
Stock Options
In fiscal 2014, 25% of the total value of the executive officers’ annual equity awards was made in the form of stock options. Stock options require price appreciation in order to be valuable awards and align holders with the specific goal of increasing stockholder value after the grant date. Stock options vest over three years, with 33.333% of the shares vesting after one year and 2.778% of the shares vesting each month thereafter.
Dividends
Intuit employees (including the Named Executive Officers) are provided dividend equivalent rights in conjunction with RSU awards, but the dividends are not paid until the shares vest. For Relative TSR RSUs, dividends will be paid based on the actual units that vest following measurement of performance and satisfaction of the three-year vesting requirement, and are subject to the same provisions as the underlying awards. Dividend equivalent rights on RSUs (including Relative TSR RSUs)that fail to vest due to performance are forfeited.
Determination of Equity Grant Value  
The Compensation Committee considers multiple factors in determining the size of an executive’s equity awards, including but not limited to annual performance ratings, retention value of current equity holdings and competitive equity award values among peer companies for roles of similar size and scope. In order to be eligible to receive equity awards, an executive must have a performance rating of “strong” or “outstanding,” and a rating of “outstanding” will, for any given role, generally result in a larger equity grant than for any other rating. In setting specific awards for our Named Executive Officers, the Committee exercises its judgment and discretion. All equity granted to our Named Executive Officers reflects the portfolio mix of 50% Relative TSR RSUs, 25% RSUs and 25% stock options discussed above.
Brad Smith. The equity granted to Mr. Smith for fiscal 2014 has a target value of $13,500,000. In determining his awards, the Compensation Committee reviewed data provided by FW Cook, in addition to the Compensation Committee’s own subjective assessment of Mr. Smith’s outstanding performance. The value of this equity, together with Mr. Smith’s fiscal year 2014 base salary and actual bonus yielded total direct compensation near the 55th percentile of peer group CEOs who are local San Francisco Bay Area competitors for talent. The Compensation Committee determined this was appropriate considering Mr. Smith’s outstanding performance, overall Company performance and his experience. The Committee gave considerable weight to local peer CEO compensation data, as they represent the companies with which Intuit competes most directly for executive talent.
Other Named Executive Officers. To determine the size of the equity awards for Messrs. Williams, Goodarzi and Wernikoff and Ms. Fennell, the Compensation Committee used data provided by FW Cook, which estimated the range of grant values provided to executives in comparable positions at companies within Intuit’s compensation peer group, as discussed above. The Compensation Committee then considered the Chief Executive Officer’s recommendations in order to determine where within the applicable range each executive’s equity grant value would fall. The Compensation Committee gives considerable weight to the recommendations provided by the Chief Executive Officer because of his direct knowledge of each other Named Executive Officer’s performance and contribution.
Neil Williams. Due to the broad scope and complexity of his role as Chief Financial Officer and his outstanding performance rating, Mr. Williams was granted equity value of $4,200,000.
Laura Fennell. Ms. Fennell was granted equity valued at $3,000,000, reflecting her outstanding performance rating and the scope of her responsibilities as General Counsel as well as her leadership of the information security, government relations and data services teams.

37


Sasan Goodarzi. Mr. Goodarzi was granted equity valued at $4,200,000, due to his outstanding performance in his role leading Intuit’s Consumer Tax Group.
Daniel Wernikoff. Mr. Wernikoff was granted equity valued at $4,000,000, due to his strong performance and his new role leading Intuit’s Small Business Group, its largest business unit.
The realization of these grant date values is subject to a significant amount of risk, and the amount actually earned over the next several years could be significantly lower if Intuit’s absolute and relative (compared against the TSR Peer Group) TSR is not strong.
The following table sets forth the actual total equity grant value awarded to each Named Executive Officer for fiscal 2014 and the RSUs, stock options and target number of Relative TSR RSUs granted in connection with the fiscal 2014 performance and compensation review process. These values were estimated using data available to the Compensation Committee on July 23, 2014. They do not match exactly the grant date fair values presented in the Summary Compensation Table, which were calculated in accordance with FASB ASC Topic 718 and take into account the price of Intuit’s common stock on the July 24, 2014 grant date.

 
 
 
 
Target # of RSUs
 
# of RSUs/Stock Options
 
 
 
 
Relative
 
 
 
 
 
 
 
 
TSR
 
 
 
 
 
 
Value-Based Equity
 
RSUs
 
RSUs
 
Stock Options
Name
 
Grant
 
(50% of value)
 
(25% of value)
 
(25% of value)
Brad D. Smith
 
$
13,500,000

 
92,100

 
40,850

 
227,450

R. Neil Williams
 
$
4,200,000

 
28,650

 
12,700

 
70,750

Laura A. Fennell
 
$
3,000,000

 
20,450

 
9,050

 
50,500

Sasan K. Goodarzi
 
$
4,200,000

 
28,650

 
12,700

 
70,750

Daniel A. Wernikoff
 
$
4,000,000

 
27,250

 
12,100

 
67,350

Achievement of Performance Hurdle for July 2013 RSU Awards
In July 2013, as part of Intuit’s annual performance and compensation review process for our last fiscal year ended July 31, 2013, the Compensation Committee approved the grant of RSUs, subject to a performance hurdle, to each Named Executive Officer. At the time of grant, the Compensation Committee established a one-year GAAP operating income hurdle of $600 million that Intuit was required to achieve in order for the awards to begin vesting. This hurdle is intended to allow the RSUs to qualify as “performance-based compensation” under Section 162(m) in order that the deductibility of any taxable income arising from these awards will not be limited by Section 162(m), however, the application of Section 162(m) is complex and may change over time (with potentially retroactive effect). Intuit’s GAAP operating income for the fiscal year ended July 31, 2014 was $1.3 billion, which exceeded the hurdle. As a result, the RSUs granted to the Named Executive Officers vest as to 33-1/3 % of the shares on each of July 1, 2014, July 1, 2015 and July 1, 2016.
Achievement of Performance Targets for July 2011 Performance-Based RSU Awards
In June and July 2011, the Compensation Committee approved the grant of performance-based RSUs to Company executives. Approximately half of the performance-based RSUs were tied to the achievement of Intuit’s three year operating goals (“2011 Operating Performance RSUs”) and half were tied to the relative total stockholder returns (“2011 Relative TSR RSUs”). In August 2014, the Compensation Committee certified the achievement of the operating performance goal at 66.3% of target and the achievement of relative TSR performance at 100.8% of target. The operating goals reflect targeted compound annual growth rates in both revenue (50% of 2011 Operating Performance RSUs) and GAAP operating income (50% of 2011 Operating Performance RSUs) for the three year period from August 1, 2011 through July 31, 2014. The below target awards in the 2011 Operating Performance RSUs during a time period when Intuit achieved compound annual revenue growth of 8.5% and compound annual operating income growth of 7.9% demonstrates the aggressive performance goals established by the Compensation Committee. The payout reflected the formula earnout and discretion was not applied. The table below sets out the metrics for the revenue growth and operating income growth goals as well as the actual results and payout levels for the 2011 Operating Performance RSUs:


38


Measure
 
Revenue Growth (CAGR)
 
GAAP Operating Income Growth (CAGR)
 
Total
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighting
 
50%
+
50%
=
100%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
FY12-FY14
 
 
 
 
 
 
 
 
FY12-FY14
 
Percent
 
Payout as
 
Operating
 
Percent
 
Payout as
 
Payout as
 
 
Revenue
 
of Target
 
a Percent
 
Income
 
of Target
 
a Percent
 
a Percent
 
 
Growth
 
Achieved
 
of Target
 
Growth
 
Achieved
 
of Target
 
of Target
Maximum
 
14.9%
 
120%
 
160%
 
21.0%
 
120%
 
160%
 
160%
 
 
14.3%
 
115%
 
145%
 
20.2%
 
115%
 
145%
 
145%
 
 
13.6%
 
110%
 
130%
 
19.3%
 
110%
 
130%
 
130%
 
 
13.0%
 
105%
 
115%
 
18.4%
 
105%
 
115%
 
115%
Target
 
12.4%
 
100%
 
100%
 
17.5%
 
100%
 
100%
 
100%
 
 
11.6%
 
93%
 
98%
 
16.4%
 
93%
 
98%
 
98%
 
 
10.8%
 
87%
 
96%
 
15.2%
 
87%
 
96%
 
96%
 
 
9.9%
 
80%
 
93%
 
14.0%
 
80%
 
93%
 
93.0%
 
 
 
 
 
 
 
 
10.5%
 
60.0%
 
70%
 
70.0%
Actual
 
8.5%
 
68.5%
 
80%
 
7.9%
 
45%
 
53%
 
66.3%
 
 
7.4%
 
60%
 
70%
 
 
 
 
 
 
 
 
 
 
5.0%
 
40%
 
47%
 
7.0%
 
40%
 
47%
 
47%
 
 
2.5%
 
20%
 
23%
 
3.5%
 
20%
 
23%
 
23%
Threshold
 
—%
 
—%
 
—%
 
—%
 
—%
 
—%
 
—%

The vesting of the 2011 Relative TSR RSUs is based on Intuit’s percentile rank of total stockholder return among the TSR peer group established for fiscal 2011 (“2011 TSR Peers”) based on the 30 day average closing stock price of each 2011 TSR Peer at the beginning and end of the performance period. Although the TSR peer group is modified each year, in order to be consistent, the vesting of the 2011 Relative TSR RSUs is based on the TSR peer group established in the year in which the 2011 Relative TSR RSUs were granted. The performance goals along with actual results for the 2011 Relative TSR RSUs are set out on the table below. Intuit’s relative TSR percentile rank was 60.5, following Intuit’s strong absolute three-year TSR of 86.8% for fiscal 2012 through fiscal 2014.

39


 
Intuit’s TSR Percentile Rank
Payout as Percent of Target
Maximum
100.0
160%
 
95.0
152.5%
 
90.0
145%
 
85.0
137.5%
 
80.0
130%
 
75.0
122.5%
 
70.0
115%
 
65.0
107.5%
Actual
60.5
100.8%
Target
60.0
100%
 
55.0
83.3%
 
50.0
66.7%
 
45.0
50%
 
40.0
33.3%
 
35.0
16.7%
Threshold
30.0
—%

For all of the Named Executive Officers other than Mr. Smith, the table below sets forth the number of 2011 performance-based RSUs that vested on September 1, 2014. With respect to Mr. Smith, 50% of his awards vested on September 1, 2014, and the remaining 50% will vest on September 1, 2016, subject to his continued employment by the Company.
    
Name
 
2011 Operating Performance RSUs Vested (1)
 
2011 Relative TSR RSUs Vested (1)
 
Total 2011 RSUs Vested (1)
 
Total 2011 Target RSUs Awarded
Brad D. Smith
 
46,200

 
77,131

 
123,331

 
146,164

R. Neil Williams
 
14,323

 
23,911

 
38,234

 
45,311

Laura A. Fennell
 
6,469

 
10,799

 
17,268

 
20,464

Sasan K. Goodarzi
 
9,952

 
15,119

 
25,071

 
30,000

Daniel A. Wernikoff
 
4,390

 
7,328

 
11,718

 
13,886


(1) For Mr. Smith, 50% of the 2011 RSUs shown in the table vested on September 1, 2014 and the remaining 50% of the RSUs are scheduled to vest on September 1, 2016, subject to his continued employment by the Company.
Fiscal 2015 Long-Term Incentives
In connection with the shift to a subscription business model, which the Compensation Committee believes will create long term value for our stockholders, in October 2014, the Compensation Committee granted key senior executives additional performance-based RSUs tied to one year growth in QuickBooks Online subscriptions after meeting a one-year GAAP operating income hurdle. The Company believes QuickBooks Online subscription growth is a key business transition driver in its new strategy, and the Committee determined that it was important to incentivize Company executives to achieve these goals. These awards will be reflected in our proxy statement for fiscal 2015, together with any annual equity awards that are made at the end of the fiscal year.
Use of Competitive Data
The Compensation Committee’s independent compensation consultant assists the Compensation Committee in defining the appropriate market of the Company’s peer companies for executive compensation and practices and in comparing our

40


executive compensation program against the peer group each year. The Compensation Committee’s objectives in using this market study were:
1. To confirm that our peer group is relevant and includes:
a. companies with which we compete for executive talent;
b. companies of similar scope and complexity;
c. companies of similar size, measured by revenue and market capitalization; and
d. companies with similar business lines.
2. To evaluate how our compensation compares to other companies using similar compensation models (including the mix of cash, equity and short and long-term incentives).
3. To create a sufficiently robust set of peers to ensure a degree of continuity year-over-year to avoid statistical distortion.

Using these objectives, FW Cook recommended a fiscal 2014 peer group with the following characteristics:

Criteria for Fiscal 2014 Peer Group
 
Characteristics
Relevant Business Lines
 
All are in GICS code 4510 (software and services), except for H&R Block, which is a direct business competitor and NetApp, which is a local talent peer.
Comparable Pay Models
 
All members of peer group use a mix of base salary, annual cash awards and some form of equity grant to executives. None of the members of the peer group have large defined benefit or similar retirement offerings as part of their ongoing executive compensation programs.
Size
 
Peer companies were selected in order to remain within a range of similar revenue between 0.4 and 2.5x and company market-capitalization value between 0.33 and 3.0x, subject to reasonable exceptions for direct business competitors and internal talent peers.
Year-over-Year Continuity
 
No companies were added to the list in fiscal 2014 and two companies were removed: BMC Software, Inc. as it was acquired during the year and Facebook, Inc., as it exceeds the defined market cap size range and does not exhibit typical public company pay practices.

FW Cook reviewed this data with the Compensation Committee in April 2014, and the Committee determined that the following companies would make up the peer group for fiscal year 2014 and fiscal year-end 2014 decisions.

2014 Compensation Peer Companies
Activision Blizzard, Inc.
 
H&R Block, Inc.
Adobe Systems, Inc.*
 
Mastercard Incorporated
Alliance Data Systems Corporation
 
NetApp, Inc.*
Autodesk, Inc.*
 
Paychex, Inc.
CA, Inc.
 
Salesforce.com, Inc.*
Citrix Systems, Inc.
 
Symantec Corporation*
Cognizant Technology Solutions Corporation
 
Teradata
eBay Inc.*
 
VMware, Inc.*
Electronic Arts, Inc.*
 
The Western Union Company
Equinix, Inc.*
 
Yahoo! Inc.*
Fiserv, Inc.
 
 
* Headquartered in the San Francisco Bay Area


41


To the extent that peer data from FW Cook’s fiscal 2013 study was used to set certain components of officers’ fiscal year 2014 compensation at the beginning of the fiscal year, the peer data were from the 2013 peer list. The compensation peers are, for the most part, a subset of the TSR Peers described above, as the Committee believes it is important for the compensation peers to be of a similar size to the Company, to more accurately reflect the scope of Intuit’s operations and the companies with which we compete for talent. In addition, as the compensation peer group is refreshed annually, acquisitions of compensation peer companies are less likely to have a meaningful impact on the analysis of Intuit’s performance and compensation measures relative to those of its peers.

When reviewing the compensation practices of companies in the peer group, the Committee also considered the practices of a sub-set of the compensation peer group that are headquartered in the San Francisco Bay Area. The Committee views these particular companies as peers among which the Company most directly competes for talent, and therefore considers the attractiveness of the Company’s compensation programs vis a vis those of these local peers, as an additional factor when making compensation decisions. The CEO compensation decisions were made with particular attention paid to the local peer group compensation levels.

The Company used the publicly reported information regarding named executive officer compensation from these companies as a reference point in assessing each executive’s compensation level. The Company then considered each executive’s role and scope of responsibilities relative to the roles of comparable positions at Intuit’s peers. Based on the foregoing information, the Company reviewed Intuit’s executive compensation programs and practices, analyzed each Named Executive Officer’s base pay, cash bonus and equity awards.
Intuit’s Management Stock Purchase Program
As a method of encouraging ownership of Intuit’s stock by executives, Intuit maintains the Management Stock Purchase Program (“MSPP”). Under the MSPP, employees with a title of director or above (including the Named Executive Officers) may elect to defer up to 15% of their annual incentive bonus, which is converted into deferred stock units based on the fair market value of Intuit’s stock on the date the bonus is awarded. These deferred stock units are fully vested on the grant date, but are not issued in the form of shares until the earlier of the third anniversary of the grant date or the termination of employment with Intuit. Intuit also grants the employee an additional RSU for every deferred stock unit purchased through this deferral, up to set maximums, as set-forth below:

Executive Level
 
Maximum Number of
Matching RSUs
Director
 
300 RSUs
Vice President
 
750 RSUs
Senior Vice President
 
1,500 RSUs
Chief Executive Officer
 
3,000 RSUs

These matching RSUs vest as to 100% of the shares three years after the grant date, or on the recipient’s death or disability. This three-year vesting period is intended to assist Intuit in retaining key talent. The RSUs granted pursuant to the MSPP are issued under the 2005 Equity Incentive Plan.

Deferred stock units purchased by employees under the MSPP after July 2012 and the matching RSUs will accrue dividends. Dividends on the purchased deferred stock units will be paid on the date the shares are issued, and dividends on matching RSUs will be paid upon their vesting.
Employee Benefits
Each of our employees with a title of director or above (including the Named Executive Officers and employee directors) is generally eligible to participate in a number of programs which make up Intuit’s total compensation package, including health and welfare benefits, executive relocation benefits, our 401(k) Plan with a company-sponsored match component, our Employee Stock Purchase Plan, our Non-Qualified Deferred Compensation Plan and our MSPP. Intuit does not offer a defined benefit pension plan. In connection with Mr. Goodarzi’s role as General Manager of the Consumer Tax Group, Mr. Goodarzi received certain relocation and travel assistance benefits to defray his costs of commuting from his primary residence in Los Gatos, California to San Diego, California and to cover housing and transportation costs in San Diego.

42


Termination Benefits
As discussed below under “Potential Payments Upon Termination of Employment or Change in Control” on page 54, the Company has agreed to provide severance payments and pro rata accelerated vesting of equity awards to our Named Executive Officers if their employment is terminated under specific circumstances. The Company agreed to provide these benefits in each Named Executive Officer’s negotiated employment agreement and/or pursuant to the Company’s benefit plans, as consideration for the executive’s agreement to provide services as an employee. Intuit does not provide excise tax “gross-up” protection in the event that a change in control severance payment is considered an excess parachute payment under U.S. tax laws.
Role of Compensation Consultants, Executive Officers and the Board in Compensation Determinations
The Compensation Committee has the authority to directly retain the services of independent consultants and other experts to assist in fulfilling its responsibilities. The Compensation Committee has engaged the services of FW Cook, a national executive compensation consulting firm, to review and provide recommendations concerning all of the components of the Company’s executive compensation program. FW Cook performs services solely on behalf of the Compensation Committee and has no relationship with the Company or management except as it may relate to performing such services. As described above under “Use of Competitive Data,” FW Cook assists the Committee in defining the peer companies used for evaluating our relative executive compensation levels and practices. FW Cook also assists the Committee in comparing our director compensation program and practices against those of our peers. The Compensation Committee has assessed the independence of FW Cook pursuant to SEC rules and concluded that FW Cook is independent and that no conflict of interest exists that would prevent FW Cook from independently representing the Compensation Committee.
The Compensation Committee received support from Intuit’s Human Resources Department in analyzing and establishing Intuit’s compensation programs for fiscal 2014. Members of Intuit’s management and staff attend meetings of the Compensation Committee, including the Senior Vice President of Human Resources, the Vice President of Compensation and an Intuit attorney. Mr. Campbell, the Chairman of the Board, regularly participated in Compensation Committee meetings, providing input on organizational structure, succession planning and executive development. Mr. Williams, our Chief Financial Officer, has provided the Compensation Committee an analysis of Intuit’s financial performance, the financial impact of various types of equity awards and proposed performance hurdles for equity incentives. Mr. Smith, our Chief Executive Officer, has provided recommendations to the Compensation Committee regarding the cash and equity compensation of his executive staff (including Mr. Williams, Ms. Fennell, Mr. Goodarzi and Mr. Wernikoff), succession planning, organizational development and the use of incentive compensation to drive Intuit’s growth. Mr. Smith also provided a self-review to the Compensation Committee to aid their evaluation of his performance. As noted above, in making compensation decisions, the Compensation Committee also has the authority to engage the services of outside advisers, experts and others to assist the Compensation Committee, and it has engaged FW Cook. For this purpose, FW Cook attended all meetings of the Compensation Committee, responding to committee members’ inquiries and refining their analysis based on these questions.
The Compensation Committee determines the compensation for Mr. Smith after obtaining information and input from FW Cook and conferring with the Board and without Mr. Smith present. In determining compensation for the Named Executive Officers other than the Chief Executive Officer, the Compensation Committee considered Mr. Smith’s recommendations. The Compensation Committee is, however, solely responsible for making the final decisions on compensation for the Named Executive Officers including the Chief Executive Officer. The Compensation Committee holds individual meetings with members of Mr. Smith’s executive staff on an annual basis to discuss organizational development and leadership strategy. The Compensation Committee also interacts frequently with members of the executive staff to discuss their business unit or functional group activities.
Accounting and Tax Implications of Our Compensation Policies
In designing our compensation programs, the Compensation Committee considers the financial accounting and tax consequences to Intuit as well as the tax consequences to our employees. In determining the aggregate number and mix of equity grants in any fiscal year, the Compensation Committee and management consider the size and share-based compensation expense of the outstanding and new equity awards relative to the one- and three-year operating plans and relative to market capitalization.
Under Section 162(m) of the Internal Revenue Code, compensation in excess of $1,000,000 per year to those executives (other than the Chief Financial Officer) whose compensation is detailed in the “Summary Compensation Table” on page 45 is not tax deductible to Intuit unless certain requirements are met. The $1,000,000 limit does not apply to compensation that is considered “performance-based” under applicable tax rules. Intuit has taken steps to see that most of the executive compensation paid under its incentive programs, including the stockholder approved SEIP and performance-based RSUs, is designed with the intent that its deductibility not be limited by Section 162(m). We believe it is important to preserve flexibility in administering compensation programs as corporate objectives may not always be consistent with the requirements for full

43


deductibility. Further, the application of Section 162(m) is complex and may change with time (with potentially retroactive effect). Accordingly, Intuit has not adopted a policy that all compensation must not be limited in its deductibility under Section 162(m) and, while Intuit strives to award executive compensation that meets the deductibility requirements, Intuit may enter into compensation arrangements under which payments are not deductible on account of Section 162(m).
Stock Ownership
Intuit has a mandatory stock ownership program that applies to employees at the senior vice president level and above (including the Named Executive Officers) and members of the Board. This program was refined in January 2012 and requires our executives and Board members to hold shares of Intuit common stock at least equal to the values indicated in the table below, which values are measured as of July 31 each year:

 
 
Stock Ownership Requirement
Role
 
Minimum Ownership
Requirement
Chief Executive Officer
 
6x base salary
Senior Vice President
 
1.5x base salary
Board members
 
5x standard annual Board retainer ($300,000)

All individuals subject to the requirements must comply within five years after the date the individual is appointed to a position subject to the guidelines, or July 2016, whichever is later. Unvested RSUs (other than performance-based RSUs) are counted as shares when determining the number of shares owned. As of July 31, 2014, all Named Executive Officers and directors subject to these requirements were in compliance.
Intuit’s Policy Regarding Derivatives, Short Sales and Hedging
Intuit's Insider Trading Policy prohibits directors and executive officers from pledging shares on margin, trading in derivative securities of Intuit's common stock, engaging in short sales of Intuit securities, or purchasing any other financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds) that are designed to hedge or offset any decrease in the market value of Intuit securities.
Intuit’s Equity Granting Policy
Stock options and RSUs may be granted by either the Compensation Committee or, pursuant to the terms of its Charter, by its delegates, the Chief Executive Officer and the Senior Vice President of Human Resources. These individuals, acting independently, each have authority to grant stock options and RSUs to employees below the level of Vice President, up to the number of shares per individual specified by the Compensation Committee. The Chief Executive Officer and the Senior Vice President of Human Resources, acting jointly, may grant such awards to employees at the level of Vice President, up to the number of shares per individual specified by the Compensation Committee, provided such employees do not report to the Chief Executive Officer or to a committee of the Board. Equity grants made to Senior Vice Presidents or above, to individuals who report to the Chief Executive Officer or to a committee of the Board, or to individuals who receive amounts above the stated share limit per individual must be approved by the Compensation Committee.
Timing of Grants.  Equity awards are typically granted on regularly scheduled grant dates on the seventh business day of each month. Exceptions to this practice are specifically approved by the Compensation Committee. The Chief Executive Officer and Senior Vice President of Human Resources do not have discretion to set other grant dates for awards made pursuant to their delegated authority. As part of Intuit’s annual performance and compensation review process, the Compensation Committee approves stock option and RSU awards to our Named Executive Officers within a few weeks before Intuit’s July 31 fiscal year-end.
Option Exercise Price.  The exercise price of a newly granted option (i.e., not an option assumed or substituted in connection with a corporate transaction) is the closing price on the NASDAQ stock market on the date of grant.

44


EXECUTIVE COMPENSATION
Summary Compensation Table
The following table shows compensation earned or granted, as applicable, during fiscal years 2014, 2013 and 2012 by our Chief Executive Officer, our Chief Financial Officer, and our three other most highly compensated executive officers for fiscal 2014. We call these individuals our “Named Executive Officers.”

Name and Principal Position
 
Fiscal Year
 
Salary
($)
 
Stock Awards
($)(2)
 
Option Awards
( $)(3)
 
Non-Equity Incentive Plan Compensation
($)(4)
 
All Other Compensation
($)
 
Total
($)
Brad D. Smith
 
2014

 
1,000,000

(1)
 
10,172,624

 
3,475,845

 
1,890,000

 
 
10,000

(6)
 
16,548,469

President and Chief
 
2013

 
1,000,000

 
 
8,759,665

 
1,571,454

 
1,120,000

 
 
12,559

 
 
12,463,678

Executive Officer
 
2012

 
975,000

 
 
8,320,578

 
1,608,698

 
1,647,750

 
 
12,559

 
 
12,564,585

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
R. Neil Williams
 
2014

 
700,000

(1)
 
3,226,791

 
1,081,187

 
630,000

(5)
 
10,000

(6)
 
5,647,978

Senior Vice President and
 
2013

 
700,000

 
 
3,361,037

 
597,040

 
420,000

 
 
16,714

 
 
5,094,791

Chief Financial Officer
 
2012

 
675,000

 
 
2,537,885

 
417,083

 
544,219

 
 
13,714

 
 
4,187,901

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Laura A. Fennell
 
2014

 
575,000

(1)
 
2,298,750

 
771,731

 
411,000

(5)
 
16,000

(6)
 
4,072,481

Senior Vice President,
 
2013

 
535,000

 
 
2,532,760

 
444,964

 
278,200

 
 
12,895

 
 
3,803,819

General Counsel and
 
2012

 
505,000

 
 
1,176,413

 
188,365

 
348,450

 
 
15,799

 
 
2,234,027

Corporate Secretary
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sasan K. Goodarzi
 
2014

 
620,000

(1)
 
3,163,836

 
1,081,187

 
524,000

 
 
250,000

(6)
 
5,639,023

Senior Vice President
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
and General Manager,
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer Tax Group
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Daniel A. Wernikoff
 
2014

 
525,000

 
 
3,010,934

 
1,029,229

 
358,500

(5)
 
13,000

(6)
 
4,936,663

Senior Vice President
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


and General Manager,
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


Small Business Group
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 



_______________________________________
(1)
The amount includes a deferral at the recipient’s election under the Non-Qualified Deferred Compensation Plan. See “Non-Qualified Deferred Compensation for Fiscal 2014” on page 53 for more information.
(2)
The amount, timing and grant date fair value of these awards are described in more detail in the “Compensation Discussion and Analysis” beginning on page 26 and are included in the table below named “Grants of Plan-Based Awards in Fiscal Year 2014.” In addition to annual stock awards, the amounts above include the fair value of RSUs which Intuit granted in August of each fiscal year to match RSUs which certain Named Executive Officers purchased with amounts deferred from their bonuses earned in such fiscal year under the MSPP. Amounts presented in the table above represent the aggregate grant date fair value of awards granted during the applicable fiscal year, computed in accordance with FASB ASC Topic 718 assuming no forfeitures. The grant date fair value of each of the RSU awards was calculated using the closing price of Intuit’s common stock on the date of grant. The time-based RSUs that are subject to a one-year operating income performance goal will all become subject to service-based vesting if the goal is satisfied, and will otherwise be forfeited in full. As a result, there is no distinction between the grant date fair value of these awards based upon the probable outcome of such conditions and the value of such awards assuming that the highest level of performance conditions is achieved. Likewise, with respect to the Relative TSR RSUs that may be earned depending on Intuit’s relative TSR, under FASB ASC Topic 718 the grant date fair value of these RSUs remains the same whether the target or maximum number of RSUs is earned.
(3)
The amount, timing and grant date fair value of these awards are described in more detail in the “Compensation Discussion and Analysis” beginning on page 26 and are included in the table below named “Grants of Plan-Based Awards in Fiscal Year 2014.” Amounts presented in the table above represent the aggregate grant date fair value of options granted during the applicable fiscal year, computed in accordance with FASB ASC Topic 718 assuming no

45


forfeitures. For information on the valuation assumptions with respect to stock option grants and for a complete description of the valuation of share-based compensation, see Intuit’s Annual Report on Form 10-K for the fiscal year ended July 31, 2014.
(4)
These amounts represent the amounts earned for performance under Intuit’s SEIP during fiscal 2014 and paid in August 2014. The SEIP is described in more detail in the “Compensation Discussion and Analysis” beginning on page 26.
(5)
The amount includes a deferral of the amount set forth in the table below at the recipient’s election under the MSPP. Under the terms of the MSPP, a participant may elect to use a stated portion of his or her annual SEIP award to purchase RSUs under Intuit’s 2005 Equity Incentive Plan. Intuit then matches these purchased RSUs with another grant of RSUs that vest three years from the date of grant. The MSPP is described in greater detail on page 42.

    
Name
 
Executive MSPP Contribution  ($)
 
Deferred Stock Units Reserved for Executive Contribution  (#)
R. Neil Williams
 
94,436

 
1,128

Laura A. Fennell
 
61,618

 
736

Daniel A. Wernikoff
 
53,748

 
642



(6)
The amount includes the items of other compensation set forth in the table below. The amounts shown for employee recognition reflect the value of awards made under Intuit’s broadly available employee recognition, or “spotlight,” program. In connection with Mr. Goodarzi’s role as General Manager of the Consumer Tax Group, Mr. Goodarzi received travel assistance benefits to defray his costs of commuting from his primary residence in Los Gatos, California to San Diego, California and to cover housing and transportation costs in San Diego.

    
Name
 
401(k) Matching Contributions ($)
 
Employee Recognition ($)
 
Travel Assistance
($)
Brad D. Smith
 
10,000

 

 

R. Neil Williams
 
10,000

 

 

Laura A. Fennell
 
10,000

 
6,000

 

Sasan K. Goodarzi
 
10,000

 

 
240,000

Daniel A. Wernikoff
 
10,000

 
3,000

 



46


Grants of Plan-Based Awards in Fiscal Year 2014
The following table provides information about Relative TSR RSUs and RSUs granted under our 2005 Equity Incentive Plan to the Named Executive Officers during fiscal 2014 and cash awards for which the Named Executive Officers were eligible in fiscal 2014 under our SEIP.

 
 
 
 
 
 
Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards
 
Estimated Future Payouts
Under Equity Incentive
Plan Awards(1)
 
All Other
Stock
Awards(1)
 
Grant Date Fair Value of
Stock Awards(2)
Name
 
Grant
Date
 
Board Approval Date
 
Target
($)
 
Maximum
($)
 
Target
(#)
 
Maximum
(#)
 
Shares
(#)
 

($)
Brad D. Smith
 
7/24/2014
 
7/24/2014
 
 

 
 

 
92,100

 
184,200

 

 
6,798,822

(5)
 
 
7/24/2014
 
7/24/2014
 
 

 
 

 
40,850

 
40,850

 

 
3,373,802

(6)
 
 
 
 
 
 
1,400,000

 
3,500,000

(3)

 

 

 

 
 
 
 
 
 
 
 

 
 

 
 

 
 

 
 

 
10,172,624

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
R. Neil Williams
 
8/16/2013
 
8/16/2013
 
 

 
 

 

 

 
980

 
62,955

(4)
 
 
7/24/2014
 
7/23/2014
 
 

 
 

 
28,650

 
57,300