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Description :
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In December 2007 the IASB issued an exposure draft ('ED') on the amendments to IFRS 2 Share-based Payment
and IFRIC 11 Group and Treasury Share Transactions: Group Cash-settled Share-based Payment Transactions.
In the May 2008 IFRIC meeting, the project staff presented a summary of the comment analysis to the IFRIC members. At the September meeting, the IASB deliberated various issues on the ED.
The proposals in the ED respond to requests for guidance on how an entity that receives goods or services from its suppliers (including employees) should account for the following arrangements:
Arrangement 1—the entity’s suppliers will receive cash payments that are linked to the price of the equity instruments of the entity
Arrangement 2—the entity’s suppliers will receive cash payments that are linked to the price of the equity instruments of the entity’s parent.
Under either arrangement, the entity’s parent has an obligation to make the required cash payments to the entity’s suppliers. The entity itself does not have any obligation to make such payments.
The proposed amendment to IFRS 2 clarifies that IFRS 2 applies to arrangements such as those described above even if the entity that receives the goods or services from its suppliers has no obligation to make the required shared-based cash payments.
The proposed amendment to IFRIC 11 brings the above transactions into the scope of IFRIC 11 and specifies that the entity should measure the goods or services in accordance with the requirements for cash-settled share-based payment transactions.
The ED makes clear that the proposals apply regardless of whether there is an arrangement for that entity to reimburse its parent or other group entity for the settlement of the obligation to the employees (or suppliers).
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Working groups :
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EFRAG Technical Expert Group (EFRAG TEG) -
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Current Project Status :
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Published in Official Journal
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Efrag Output
No 'Efrag Output'
Comment Letters
No 'Comment Letters'
Other Input
No 'Other Input'
News Items
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