## Significant Changes in the State of Affairs 

In the opinion of the directors, there were no significant changes in the state of affairs of the consolidated entity that occurred during the financial year. 

## Significant Events After Balance Date 

There have been no material events subsequent to balance date, apart from: 

(1) the grant of certain options by Pertama Holdings Limited, Singapore to Martin Dunkerley (see Note 26 of the financial statements), 

(2) the opening of two Harvey Norman stores in the Republic of Ireland. 

## Likely Developments and Future Results 

The directors have excluded from this report any further information on the likely developments in the operations of the consolidated entity and the expected results of those operations in future financial years, as the directors believe that it would be likely to result in unreasonable prejudice to one or more entities in the consolidated entity. 

## Environmental Regulation Performance 

The consolidated entity’s environmental obligations are regulated under both State and Federal Law. All environmental performance obligations are monitored by the Board. The consolidated entity has a policy of at least complying, but in most cases exceeding its environmental performance obligations. No environmental breaches have been notified to the consolidated entity by any Government agency during the year ended 30 June 2003. 

## Emoluments of Board Members and Senior Executives 

## Remuneration Policy 

The Remuneration Committee of the Board of Directors is responsible for reviewing compensation arrangements for the directors, the Managing Director and the executive team and making recommendations to the Board of Directors about such matters. The Remuneration Committee assesses the appropriateness of the nature and amount of remuneration received by such officers on a periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum stakeholder benefit from the retention of a high quality board and executive team. 

Remuneration is generally determined by the Board of Directors on a total cost of employment basis and packages generally comprise salary, superannuation and a fully maintained motor vehicle where appropriate. The present policy of the Board is that options to acquire shares in the company will not be granted to employees or executive directors without specific shareholder approval. The Board has determined that bonuses may be awarded to employees, but only as a consequence of exceptional performance. 

