IAS 19 – Employee Benefits

The course demonstrates accounting for employee benefits in accordance with International Accounting Standards 19. IAS 19 uses the principle that the cost of providing employee benefits should be recognized in the period in which the benefit is earned by the employee, rather than when it is paid or payable.

The standard identifies several categories of employee benefit including:

• Short-term employee benefits, such as sick pay
• Post-employment benefits such as pensions
• Termination benefits, and
• Other long-term employee benefits including long service leave.

Accounting for post-employment benefits is an important financial reporting issue. It has been suggested that many users of financial statements do not fully understand the information that entities provide about post-employment benefits. We learn in this course how to account for the two categorization of employee benefits namely: Defined-contribution and defined-benefit plans. We also learn the treatment actuarial gains and losses.

Course Key Concepts: Employee benefits, Defined-contribution plan, Defined-benefit plan, Actuarial gains and losses, Current service cost, Interest cost, Curtailments, Settlements, Plan asset, Obligation.