Regulation revoked (31.12.2020) by The International Accounting Standards and European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/685), reg. 1(2), Sch. 2 para. 32 (with reg. 20(2)) (as amended by S.I. 2020/335, regs. 1, 5); 2020 c. 1, Sch. 5 para. 1(1)

http://www.legislation.gov.uk/eur/2012/475Commission Regulation (EU) No 475/2012 of 5 June 2012 amending Regulation (EC) No 1126/2008 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards International Accounting Standard (IAS) 1 and International Accounting Standard (IAS) 19 (Text with EEA relevance) (revoked)Commission Regulation (EU) No 475/2012Commission Regulation (EU) No 475/2012 of 5 June 2012 amending Regulation (EC) No 1126/2008 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards International Accounting Standard (IAS) 1 and International Accounting Standard (IAS) 19 (Text with EEA relevance)2023-05-05King's Printer of Acts of Parliamenthttps://webarchive.nationalarchives.gov.uk/eu-exit/https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:02012R0475-20120701texttext/xmlen2020-12-31

Commission Regulation (EU) No 475/2012

of 5 June 2012

amending Regulation (EC) No 1126/2008 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards International Accounting Standard (IAS) 1 and International Accounting Standard (IAS) 19

(Text with EEA relevance) (revoked)

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Article 1

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Article 2

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Article 3

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ANNEXINTERNATIONAL ACCOUNTING STANDARDS

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AMENDMENTS TO IAS 1 Presentation of Financial Statements

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7The following terms are used in this Standard with the meanings specified:

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10A complete set of financial statements comprises:

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10A

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Statement of profit or loss and other comprehensive income

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81AThe statement of profit or loss and other comprehensive income (statement of comprehensive income) shall present, in addition to the profit or loss and other comprehensive income sections:

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81BAn entity shall present the following items, in addition to the profit or loss and other comprehensive income sections, as allocation of profit or loss and other comprehensive income for the period:

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Information to be presented in profit or loss section or the statement of profit or loss

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82In addition to items required by other IFRSs, the profit or loss section or the statement of profit or loss shall include line items that present the following amounts for the period:

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Information to be presented in the other comprehensive income section

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82AThe other comprehensive income section shall present line items for amounts of other comprehensive income in the period, classified by nature (including share of the other comprehensive income of associates and joint ventures accounted for using the equity method) and grouped into those that, in accordance with other IFRSs:

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91An entity may present items of other comprehensive income either:

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Information to be presented in the statement(s) of profit or loss and other comprehensive income or in the notes

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100

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115

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139J

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AMENDMENTS TO OTHER IFRSS

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IFRS 1 First-time Adoption of International Financial Reporting Standards

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39K

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IFRS 5 Non-current Assets Held for Sale and Discontinued Operations

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33A

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44I

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IFRS 7 Financial Instruments: Disclosures

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27BFor fair value measurements recognised in the statement of financial position an entity shall disclose for each class of financial instruments:

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44Q

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IAS 12 Income Taxes

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98B

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IAS 20 Accounting for Government Grants and Disclosure of Government Assistance

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IAS 21 The Effects of Changes in Foreign Exchange Rates

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39The results and financial position of an entity whose functional currency is not the currency of a hyperinflationary economy shall be translated into a different presentation currency using the following procedures:

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60H

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IAS 32 Financial Instruments: Presentation

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97K

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IAS 33 Earnings per Share

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67A

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68A

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73A

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74D

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IAS 34 Interim Financial Reporting

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8An interim financial report shall include, at a minimum, the following components:

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11A

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20Interim reports shall include interim financial statements (condensed or complete) for periods as follows:

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INTERNATIONAL ACCOUNTING STANDARD 19 Employee Benefits

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OBJECTIVE

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1The objective of this Standard is to prescribe the accounting and disclosure for employee benefits. The Standard requires an entity to recognise:

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SCOPE

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4The employee benefits to which this Standard applies include those provided:

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5Employee benefits include:

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DEFINITIONS

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8The following terms are used in this Standard with the meanings specified:

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SHORT-TERM EMPLOYEE BENEFITS

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9Short-term employee benefits include items such as the following, if expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related services:

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Recognition and measurement

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All short-term employee benefits

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11When an employee has rendered service to an entity during an accounting period, the entity shall recognise the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service:

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Short-term paid absences

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13An entity shall recognise the expected cost of short-term employee benefits in the form of paid absences under paragraph 11 as follows:

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14An entity may pay employees for absence for various reasons including holidays, sickness and short-term disability, maternity or paternity, jury service and military service. Entitlement to paid absences falls into two categories:

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17The method specified in the previous paragraph measures the obligation at the amount of the additional payments that are expected to arise solely from the fact that the benefit accumulates. In many cases, an entity may not need to make detailed computations to estimate that there is no material obligation for unused paid absences. For example, a sick leave obligation is likely to be material only if there is a formal or informal understanding that unused paid sick leave may be taken as paid annual leave.

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Example illustrating paragraphs 16 and 17

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Profit-sharing and bonus plans

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19An entity shall recognise the expected cost of profit-sharing and bonus payments under paragraph 11 when, and only when:

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20Under some profit-sharing plans, employees receive a share of the profit only if they remain with the entity for a specified period. Such plans create a constructive obligation as employees render service that increases the amount to be paid if they remain in service until the end of the specified period. The measurement of such constructive obligations reflects the possibility that some employees may leave without receiving profit-sharing payments.

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Example illustrating paragraph 20

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22An entity can make a reliable estimate of its legal or constructive obligation under a profit-sharing or bonus plan when, and only when:

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Disclosure

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POST-EMPLOYMENT BENEFITS: DISTINCTION BETWEEN DEFINED CONTRIBUTION PLANS AND DEFINED BENEFIT PLANS

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26Post-employment benefits include items such as the following:

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29Examples of cases where an entity’s obligation is not limited to the amount that it agrees to contribute to the fund are when the entity has a legal or constructive obligation through:

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30Under defined benefit plans:

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Multi-employer plans

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33If an entity participates in a multi-employer defined benefit plan, unless paragraph 34 applies, it shall:

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34When sufficient information is not available to use defined benefit accounting for a multi-employer defined benefit plan, an entity shall:

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35One example of a multi-employer defined benefit plan is one where:

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36Where sufficient information is available about a multi-employer defined benefit plan, an entity accounts for its proportionate share of the defined benefit obligation, plan assets and post-employment cost associated with the plan in the same way as for any other defined benefit plan. However, an entity may not be able to identify its share of the underlying financial position and performance of the plan with sufficient reliability for accounting purposes. This may occur if:

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37There may be a contractual agreement between the multi-employer plan and its participants that determines how the surplus in the plan will be distributed to the participants (or the deficit funded). A participant in a multi-employer plan with such an agreement that accounts for the plan as a defined contribution plan in accordance with paragraph 34 shall recognise the asset or liability that arises from the contractual agreement and the resulting income or expense in profit or loss.

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Example illustrating paragraph 37

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Defined benefit plans that share risks between entities under common control

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State plans

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Insured benefits

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46An entity may pay insurance premiums to fund a post-employment benefit plan. The entity shall treat such a plan as a defined contribution plan unless the entity will have (either directly, or indirectly through the plan) a legal or constructive obligation either:

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48Where an entity funds a post-employment benefit obligation by contributing to an insurance policy under which the entity (either directly, indirectly through the plan, through the mechanism for setting future premiums or through a related party relationship with the insurer) retains a legal or constructive obligation, the payment of the premiums does not amount to a defined contribution arrangement. It follows that the entity:

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POST-EMPLOYMENT BENEFITS: DEFINED CONTRIBUTION PLANS

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Recognition and measurement

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51When an employee has rendered service to an entity during a period, the entity shall recognise the contribution payable to a defined contribution plan in exchange for that service:

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Disclosure

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POST-EMPLOYMENT BENEFITS: DEFINED BENEFIT PLANS

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Recognition and measurement

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57Accounting by an entity for defined benefit plans involves the following steps:

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Accounting for the constructive obligation

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Statement of financial position

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64When an entity has a surplus in a defined benefit plan, it shall measure the net defined benefit asset at the lower of:

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65A net defined benefit asset may arise where a defined benefit plan has been overfunded or where actuarial gains have arisen. An entity recognises a net defined benefit asset in such cases because:

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Recognition and measurement: present value of defined benefit obligations and current service cost

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66The ultimate cost of a defined benefit plan may be influenced by many variables, such as final salaries, employee turnover and mortality, employee contributions and medical cost trends. The ultimate cost of the plan is uncertain and this uncertainty is likely to persist over a long period of time. In order to measure the present value of the post-employment benefit obligations and the related current service cost, it is necessary:

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Actuarial valuation method

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68The projected unit credit method (sometimes known as the accrued benefit method pro-rated on service or as the benefit/years of service method) sees each period of service as giving rise to an additional unit of benefit entitlement (see paragraphs 70–74) and measures each unit separately to build up the final obligation (see paragraphs 75–98).

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Example illustrating paragraph 68

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Note:

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Attributing benefit to periods of service

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70In determining the present value of its defined benefit obligations and the related current service cost and, where applicable, past service cost, an entity shall attribute benefit to periods of service under the plan’s benefit formula. However, if an employee’s service in later years will lead to a materially higher level of benefit than in earlier years, an entity shall attribute benefit on a straight-line basis from:

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71The projected unit credit method requires an entity to attribute benefit to the current period (in order to determine current service cost) and the current and prior periods (in order to determine the present value of defined benefit obligations). An entity attributes benefit to periods in which the obligation to provide post-employment benefits arises. That obligation arises as employees render services in return for post-employment benefits that an entity expects to pay in future reporting periods. Actuarial techniques allow an entity to measure that obligation with sufficient reliability to justify recognition of a liability.

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Examples illustrating paragraph 71

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1A defined benefit plan provides a lump sum benefit of CU100 payable on retirement for each year of service.

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2A plan provides a monthly pension of 0,2 per cent of final salary for each year of service. The pension is payable from the age of 65.

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72Employee service gives rise to an obligation under a defined benefit plan even if the benefits are conditional on future employment (in other words they are not vested). Employee service before the vesting date gives rise to a constructive obligation because, at the end of each successive reporting period, the amount of future service that an employee will have to render before becoming entitled to the benefit is reduced. In measuring its defined benefit obligation, an entity considers the probability that some employees may not satisfy any vesting requirements. Similarly, although some post-employment benefits, for example, post-employment medical benefits, become payable only if a specified event occurs when an employee is no longer employed, an obligation is created when the employee renders service that will provide entitlement to the benefit if the specified event occurs. The probability that the specified event will occur affects the measurement of the obligation, but does not determine whether the obligation exists.

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Examples illustrating paragraph 72

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1A plan pays a benefit of CU100 for each year of service. The benefits vest after ten years of service.

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2A plan pays a benefit of CU100 for each year of service, excluding service before the age of 25. The benefits vest immediately.

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73The obligation increases until the date when further service by the employee will lead to no material amount of further benefits. Therefore, all benefit is attributed to periods ending on or before that date. Benefit is attributed to individual accounting periods under the plan’s benefit formula. However, if an employee’s service in later years will lead to a materially higher level of benefit than in earlier years, an entity attributes benefit on a straight-line basis until the date when further service by the employee will lead to no material amount of further benefits. That is because the employee’s service throughout the entire period will ultimately lead to benefit at that higher level.

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Examples illustrating paragraph 73

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1A plan pays a lump sum benefit of CU1,000 that vests after ten years of service. The plan provides no further benefit for subsequent service.

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2A plan pays a lump sum retirement benefit of CU2,000 to all employees who are still employed at the age of 55 after twenty years of service, or who are still employed at the age of 65, regardless of their length of service.

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3A post-employment medical plan reimburses 40 per cent of an employee’s post-employment medical costs if the employee leaves after more than ten and less than twenty years of service and 50 per cent of those costs if the employee leaves after twenty or more years of service.

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4A post-employment medical plan reimburses 10 per cent of an employee’s post-employment medical costs if the employee leaves after more than ten and less than twenty years of service and 50 per cent of those costs if the employee leaves after twenty or more years of service.

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74Where the amount of a benefit is a constant proportion of final salary for each year of service, future salary increases will affect the amount required to settle the obligation that exists for service before the end of the reporting period, but do not create an additional obligation. Therefore:

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Example illustrating paragraph 74

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Actuarial assumptions

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76Actuarial assumptions are an entity’s best estimates of the variables that will determine the ultimate cost of providing post-employment benefits. Actuarial assumptions comprise:

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Actuarial assumptions: mortality

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Actuarial assumptions: discount rate

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Actuarial assumptions: salaries, benefits and medical costs

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87An entity shall measure its defined benefit obligations on a basis that reflects:

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88Actuarial assumptions reflect future benefit changes that are set out in the formal terms of a plan (or a constructive obligation that goes beyond those terms) at the end of the reporting period. This is the case if, for example:

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89Actuarial assumptions do not reflect future benefit changes that are not set out in the formal terms of the plan (or a constructive obligation) at the end of the reporting period. Such changes will result in:

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91Some defined benefit plans limit the contributions that an entity is required to pay. The ultimate cost of the benefits takes account of the effect of a limit on contributions. The effect of a limit on contributions is determined over the shorter of:

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94Changes in employee or third-party contributions in respect of service result in:

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Past service cost and gains and losses on settlement

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100

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101

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Past service cost

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102

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103An entity shall recognise past service cost as an expense at the earlier of the following dates:

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104

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105

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106

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107

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108Past service cost excludes:

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Gains and losses on settlement

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109The gain or loss on a settlement is the difference between:

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110

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111

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112

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Recognition and measurement: plan assets

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Fair value of plan assets

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113

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114

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115

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Reimbursements

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116When, and only when, it is virtually certain that another party will reimburse some or all of the expenditure required to settle a defined benefit obligation, an entity shall:

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117

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118

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119

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Components of defined benefit cost

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120An entity shall recognise the components of defined benefit cost, except to the extent that another IFRS requires or permits their inclusion in the cost of an asset, as follows:

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121

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122

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Net interest on the net defined benefit liability (asset)

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123

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124

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125

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126

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Remeasurements of the net defined benefit liability (asset)

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127Remeasurements of the net defined benefit liability (asset) comprise:

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128Actuarial gains and losses result from increases or decreases in the present value of the defined benefit obligation because of changes in actuarial assumptions and experience adjustments. Causes of actuarial gains and losses include, for example:

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129

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130

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Presentation

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Offset

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131An entity shall offset an asset relating to one plan against a liability relating to another plan when, and only when, the entity:

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132

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Current/non-current distinction

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133

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Components of defined benefit cost

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134

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Disclosure

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135An entity shall disclose information that:

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136To meet the objectives in paragraph 135, an entity shall consider all the following:

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137If the disclosures provided in accordance with the requirements in this Standard and other IFRSs are insufficient to meet the objectives in paragraph 135, an entity shall disclose additional information necessary to meet those objectives. For example, an entity may present an analysis of the present value of the defined benefit obligation that distinguishes the nature, characteristics and risks of the obligation. Such a disclosure could distinguish:

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138An entity shall assess whether all or some disclosures should be disaggregated to distinguish plans or groups of plans with materially different risks. For example, an entity may disaggregate disclosure about plans showing one or more of the following features:

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Characteristics of defined benefit plans and risks associated with them

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139An entity shall disclose:

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Explanation of amounts in the financial statements

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140An entity shall provide a reconciliation from the opening balance to the closing balance for each of the following, if applicable:

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141Each reconciliation listed in paragraph 140 shall show each of the following, if applicable:

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142An entity shall disaggregate the fair value of the plan assets into classes that distinguish the nature and risks of those assets, subdividing each class of plan asset into those that have a quoted market price in an active market (as defined in IFRS 13 Fair Value Measurement ) and those that do not. For example, and considering the level of disclosure discussed in paragraph 136, an entity could distinguish between:

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143

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144

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Amount, timing and uncertainty of future cash flows

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145An entity shall disclose:

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146

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147To provide an indication of the effect of the defined benefit plan on the entity’s future cash flows, an entity shall disclose:

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Multi-employer plans

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148If an entity participates in a multi-employer defined benefit plan, it shall disclose:

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Defined benefit plans that share risks between entities under common control

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149If an entity participates in a defined benefit plan that shares risks between entities under common control, it shall disclose:

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150The information required by paragraph 149(c) and (d) can be disclosed by cross-reference to disclosures in another group entity’s financial statements if:

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Disclosure requirements in other IFRSs

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151Where required by IAS 24 an entity discloses information about:

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152

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OTHER LONG-TERM EMPLOYEE BENEFITS

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153Other long-term employee benefits include items such as the following, if not expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related service:

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154

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Recognition and measurement

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155

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156For other long-term employee benefits, an entity shall recognise the net total of the following amounts in profit or loss, except to the extent that another IFRS requires or permits their inclusion in the cost of an asset:

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157

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Disclosure

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158

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TERMINATION BENEFITS

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159

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160

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161The form of the employee benefit does not determine whether it is provided in exchange for service or in exchange for termination of the employee’s employment. Termination benefits are typically lump sum payments, but sometimes also include:

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162Indicators that an employee benefit is provided in exchange for services include the following:

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163

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164

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Recognition

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165An entity shall recognise a liability and expense for termination benefits at the earlier of the following dates:

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166For termination benefits payable as a result of an employee’s decision to accept an offer of benefits in exchange for the termination of employment, the time when an entity can no longer withdraw the offer of termination benefits is the earlier of:

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167For termination benefits payable as a result of an entity’s decision to terminate an employee’s employment, the entity can no longer withdraw the offer when the entity has communicated to the affected employees a plan of termination meeting all of the following criteria:

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168

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Measurement

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169An entity shall measure termination benefits on initial recognition, and shall measure and recognise subsequent changes, in accordance with the nature of the employee benefit, provided that if the termination benefits are an enhancement to post-employment benefits, the entity shall apply the requirements for post-employment benefits. Otherwise:

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170Because termination benefits are not provided in exchange for service, paragraphs 70–74 relating to the attribution of the benefit to periods of service are not relevant.

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Example illustrating paragraphs 159–170

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Background

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Termination benefits

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Benefits provided in exchange for service

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Disclosure

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171

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TRANSITION AND EFFECTIVE DATE

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172

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173An entity shall apply this Standard retrospectively, in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, except that:

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APPENDIX Amendments to other IFRSs

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IFRS 1 First-time Adoption of International Financial Reporting Standards

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A1Paragraph 39L is added as follows:

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39L

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A2In Appendix D (Exemptions from other IFRSs), the heading above paragraph D10 and paragraphs D10 and D11 are deleted and paragraph D1 is amended as follows:

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D1An entity may elect to use one or more of the following exemptions:

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A3In Appendix E (Short-term exemptions from IFRSs), a heading and paragraph E5 are added as follows:

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IFRS 8 Operating Segments

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A4Paragraph 24 is amended as follows:

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24An entity shall disclose the following about each reportable segment if the specified amounts are included in the measure of segment assets reviewed by the chief operating decision maker or are otherwise regularly provided to the chief operating decision maker, even if not included in the measure of segment assets:

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IFRS 13 Fair Value Measurement

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IAS 19 Employee Benefits (as amended in June 2011)

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A6Paragraphs D62 and D63 are amended as follows:

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D62Paragraph 113 is amended as follows:

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D63Paragraph 174 is added as follows:

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IAS 1 Presentation of Financial Statements

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A7In paragraph 7, the definition of ‘other comprehensive income’ is amended as follows:

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7…

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A8Paragraph 96 is amended, and paragraph 139K is added as follows:

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139K

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IAS 24 Related Party Disclosures

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A9Paragraph 22 is amended as follows:

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IFRIC 14 IAS 19 — The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction

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A10Below the heading ‘References’, after the reference to IAS 19 Employee Benefits is added ‘(as amended in 2011)’.

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6The issues addressed in this Interpretation are:

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27C

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