Definition Employee benefits are all forms of consideration given by an entity in exchange for service rendered by employees.

The Objective of Standard The objective of this Standard is to prescribe the accounting and disclosure for employee benefits. The Standard requires an entity to recognise: (a) a liability when an employee has provided service in exchange for employee benefits to be paid in the future; (b) an expense when the entity consumes the economic benefit from service provided by an employee in exchange for employee benefits.

Objectives and scope Accounting and disclosure of Short term employee benefits Post employment benefits Other long term employee benefits Termination benefits

Short-term employee benefits Short-term employee benefits are employee benefits which fall due wholly within twelve months after the end of the period in which the employees render the related service.

Post-employment benefits Post-employment benefits are employee benefits payable after the completion of employment. Post-employment benefit plans are classified as either defined contribution plans or defined benefit plans, depending on the economic substance of the plan.

Defined contribution plans Defined benefit plans Post employment benefits

Defined contribution plans Defined contribution plans are post-employment benefit plans under which an entity pays fixed contributions into a separate entity (a fund) and will have no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods

Defined benefit plans Under defined benefit plans: (a) the entity’s obligation is to provide the agreed benefits to current and former employees. (b) actuarial risk (that benefits will cost more than expected) and investment risk fall, in substance, on the entity. If actuarial or investment experience are worse than expected, the entity’s obligation may be increased

Other long-term employee benefits Other long-term employee benefits are employee benefits (other than post- employment benefits and termination benefits) which do not fall due wholly within twelve months after the end of the period in which the employees render the related service.

Termination benefits Termination benefits are employee benefits payable as a result of either: (a) an entity’s decision to terminate an employee’s employment before the normal retirement date; or (b) an employee’s decision to accept voluntary redundancy in exchange for those benefits.

Scope of the Standard It shall be applied in accounting for, and in the disclosure of, government grants and in the disclosure of other forms of government assistance.

Definitions Government assistance is action by government designed to provide an economic benefit specific to an entity or range of entities qualifying under certain criteria. Government grants are assistance by government in the form of transfers of resources to an entity in return for past or future compliance with certain conditions relating to the operating activities of the entity. Grants related to assets are government grants whose primary condition is that an entity qualifying for them should purchase, construct or otherwise acquire long-term assets.

Government grants Government grants shall not be recognized until there is reasonable assurance that: (a) the entity will comply with the conditions attaching to them (b) the grants will be received

Non-monetary government grants A government grant may take the form of a transfer of a non-monetary asset, such as land or other resources, for the use of the entity.

Presentation of grants related to assets Government grants related to assets, including non- monetary grants at fair value, shall be presented in the statement of financial position either by setting up the grant as deferred income or by deducting the grant in arriving at the carrying amount of the asset

Presentation of grants related to income Grants related to income are presented as part of profit or loss, either separately or under a general heading such as ‘Other income’; alternatively, they are deducted in reporting the related expense.

Repayment of Government Grants Repayment of a grant related to income shall be applied first against any unamortized deferred credit recognized in respect of the grant. To the extent that the repayment exceeds any such deferred credit, or when no deferred credit exists, the repayment shall be recognised immediately in profit or loss. Repayment of a grant related to an asset shall be recognised by increasing the carrying amount of the asset or reducing the deferred income balance by the amount repayable. The cumulative additional depreciation that would have been recognised in profit or loss to date in the absence of the grant shall be recognised immediately in profit or loss.

Government Assistance Government assistance cannot reasonably have a value placed upon them and transactions with government which cannot be distinguished from the normal trading transactions of the entity.

Disclosure The following matters shall be disclosed: (a) the accounting policy adopted for government grants, including the methods of presentation adopted in the financial statements; (b) the nature and extent of government grants recognized in the financial statements and an indication of other forms of government assistance from which the entity has directly benefited; (c) unfulfilled conditions and other contingencies attaching to government assistance that has been recognized