Employee Benefits

Question 1

Scope

Answer 1

1. Applies to the accounting for all employee benefits
2. Does not apply to IFRS 2 “Share Based Payment” transactions

Question 2

Objectives

Answer 2

To prescribe the accounting and disclosure for employee benefit

Question 3

Types of Employee benefits

Answer 3

1. Short term benefits
2. Post employment benefits
3. Termination benefits
4. Other long term benefits

Question 4

Short Term Employee Benefits

Answer 4

Benefits payable within 12 months

Question 5

Measurement of short-term employee benefits

Answer 5

Undiscounted amount expensed

Question 6

Recognition of short-term employee benefits

Answer 6

When services are rendered

Question 7

Disclosure of short-term employee benefits

Answer 7

Any expense recognised in terms of short term benefits

Question 8

Exceptions of short-term employee benefits

Answer 8

1. short term compensated absences (Pg306 Introduction to IFRS)
   1.1 Accumulating vs non accumulating
2. Profit sharing and bonus payments
   2.1 Present obligation
   2.2 Reliable estimate

Question 9

Post-employment benefits

Answer 9

1. Defined contribution plans (par 50 – 54)
   1.1 are post-employment benefit plans under which

            1.2 an entity pays FIXED CONTRIBUTIONS into a separate entity (fund) and 
   
            1.3 will have no legal or constructive obligation to pay further contributions
   
            1.4 if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods

Question 10

Post-employment benefits Recognition

Answer 10

When an employee has rendered a service to an entity during a period, the entity shall recognize the contribution payable (to the fund) in exchange for that service as:

2. A Liability (accrued expense), after deducting any contribution already paid

Question 11

Post-employment benefits Measurement

Answer 11

1. No actuarial assumptions
2. No discounting unless payment period > 12 months

Question 12

Post-employment benefits Disclosure

Answer 12

Disclose the amount recognised as an expense

Question 13

Termination benefits recognition

Answer 13

1. Liability and expense at the earlier of:
   1.1 Entity can no longer withdraw the offer of those benefits and

        1.2 Entity recognises costs for a restructuring that is within the scope of IAS37 and involves the payment of termination benefits.

Question 14

Termination benefits Disclosure

Answer 14

No specific disclosure relating to termination benefits