IFRS for SMEs Employee Benefits and Share-Based Payment Flashcards

Under IFRS for SMEs, short-term employee benefits that are expected to be settled within 12 months after the reporting period are measured at:

Answer: Undiscounted amounts

Short-term employee benefits are measured at the undiscounted amount expected to be paid because they are settled within 12 months and discounting would not be material.

Under IFRS for SMEs, a defined contribution plan is one where:

Answer: The entity pays fixed contributions and has no further obligation

In a defined contribution plan, the entity's legal or constructive obligation is limited to the amount it agrees to contribute, with no guarantee of future benefits.

How does IFRS for SMEs require an entity to measure the liability for a defined benefit plan?

Answer: Using the projected unit credit method or a simplified method

IFRS for SMEs allows entities to use the projected unit credit method or a simplified method to measure defined benefit obligations.

Under IFRS for SMEs, the cost of a defined contribution pension plan for the period is:

Answer: The contribution payable for the period

For defined contribution plans, the cost recognized is simply the contribution payable to the fund for the reporting period.

Under IFRS for SMEs, short-term paid absences such as vacation leave are recognized:

Answer: As a liability and expense when employees render service that increases their entitlement

Accumulating short-term paid absences are recognized as the employees provide the service that creates the entitlement, not when the leave is taken.

Which of the following is an example of a long-term employee benefit under IFRS for SMEs?

Answer: Long-term disability benefits payable more than 12 months after the reporting period

Long-term employee benefits are those not expected to be settled within 12 months after the reporting period, such as long-term disability benefits.