On Larry Ellison’s income

Wonder why the words “Oracle” and “money” (not to mention the combination thereof) get so much attention? Wonder no more, as now the world can see just how much Oracle Corporation CEO Lawrence Ellison pulled down for fiscal year 2006. Yesterday, Oracle released numbers showing that Ellison bagged about US $55.4 million in total compensation in fiscal 2006, well more than double what he got in 2005.

Ellison received US $7.4 million in salary and bonus in fiscal 2006, almost the same figure as the year previous. Six million options granted to Ellison are valued today US $12.34 a share, and were valued at US $46.6 million with a 5 percent annual appreciation or US $118 million at 10 percent.

In 2005, 2.5 million options were granted to him at a strike price of US $10.83 per share. Ellison also collected some US $63.2 million from stock options exercised during the 2006 fiscal year. Mind-boggling numbers all for us small fish in the pond here, but most eye-popping of all is the crazy US $1.8 million paid for Ellison’s home security in 2006.

In a proxy filing with the Securities and Exchange Commission, the Oracle board started a home security program for Ellison two years ago; this program plunked US $531,000 and US $1.37 million in the two years previous for personnel and “equipment.” Some media voices displayed the gut reaction, a bit of a cry of protest at the outrageousness of the figure (come on; US $2.7 million plus?), and sharper-eyed observers noted the suspiciousness of the Oracle announcement made the same day with featured a buried item from the firm.

A filing with the SEC at the end of the business day Wednesday stated that Oracle senior vice president of global finance and operations and chief accounting officer Jennifer Minton plans to step down effective Oct. 11. Minton will resign after filing of the company’s first-quarter fiscal year 2007 Form 10-Q after 17 years with Oracle. Her resignation, said official company PR, is not related to any disagreement with senior management or with the Oracle’s accounting or operating policies; “personal reasons” was supplied as an answer instead. Business writer and author of “Financial Fine Print” Michelle Leder gave voice to the suspicious in remarks published over at software stock website Seeking Alpha.

Leder stated that “One of the questions is why Ellison’s security expenses are substantially higher than what other companies are spending. After all, is Ellison really in nearly twice as much danger as Michael Dell, chairman of Dell Computers?” Leder went on to point out that a proxy filed last August shows that the company spent US $922,000 on Ellison’s security needs in fiscal 2005. “How can the numbers be off so much?” wonders Leder. “Good question. Maybe the soon-to-be departed chief accounting officer knows. Oracle investors should hope that other numbers are a bit more on-the-mark.”