Long-term plans, often referred to as capital accumulation, can focus the attention of senior managers on business success issues that go beyond the type of measures used in short-term plans. The annual plan may use Sales Growth, or Earning before Income Taxes or perhaps a combination of such measures. Then Long Term Incentive plans can look at success measures, Return on Equity, Return on Capital and so forth.

Long-term plans, typically, cover a three to five year measurement cycle but can be designed in a way to provide the potential of annual payout.

These plans often use equity, simulated equity, cash or a combination.

Monterey Benefits, LLC can assist organizations in evaluating Long - Term Equity Compensation plans, through its partner The Analytical Consulting Company.