IFRIC11 BV2009 - IFRIC 11 IFRIC Interpretation 11 IFRS...

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IFRIC 11 IFRIC Interpretation 11 IFRS 2—Group and Treasury Share Transactions IFRIC 11 IFRS 2—Group and Treasury Share Transactions was developed by the International Financial Reporting Interpretations Committee and issued by the International Accounting Standards Board in November 2006. © IASCF 1
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IFRIC 11 C ONTENTS paragraphs IFRIC INTERPRETATION 11 IFRS 2—GROUP AND TREASURY SHARE TRANSACTIONS REFERENCES ISSUES 1–6 CONSENSUS 7–11 EFFECTIVE DATE 12 TRANSITION 13 ILLUSTRATIVE EXAMPLE BASIS FOR CONCLUSIONS 2 © IASCF
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IFRIC 11 IFRIC Interpretation 11 IFRS 2—Group and Treasury Share Transactions (IFRIC 11) is set out in paragraphs 1–13. IFRIC 11 is accompanied by an Illustrative Example and a Basis for Conclusions. The scope and authority of Interpretations are set out in paragraphs 2 and 7–17 of the Preface to International Financial Reporting Standards . © IASCF 3
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IFRIC 11 IFRIC Interpretation 11 IFRS 2—Group and Treasury Share Transactions References IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors IAS 32 Financial Instruments: Presentation IFRS 2 Share-based Payment Issues 1 This Interpretation addresses two issues. The first is whether the following transactions should be accounted for as equity-settled or as cash-settled under the requirements of IFRS 2: (a) an entity grants to its employees rights to equity instruments of the entity (eg share options), and either chooses or is required to buy equity instruments (ie treasury shares) from another party, to satisfy its obligations to its employees; and (b) an entity’s employees are granted rights to equity instruments of the entity (eg share options), either by the entity itself or by its shareholders, and the shareholders of the entity provide the equity instruments needed. 2 The second issue concerns share-based payment arrangements that involve two or more entities within the same group. For example, employees of a subsidiary are granted rights to equity instruments of its parent as consideration for the services provided to the subsidiary. IFRS 2 paragraph 3 states that: For the purposes of this IFRS, transfers of an entity’s equity instruments by its shareholders to parties that have supplied goods or services to the entity (including employees) are share-based payment transactions, unless the transfer is clearly for a purpose other than payment for goods or services supplied to the entity. This also applies to transfers of equity instruments of the entity’s parent, or equity instruments of another entity in the same group as the entity, to parties that have supplied goods or services to the entity. [Emphasis added] However, IFRS 2 does not give guidance on how to account for such transactions in the individual or separate financial statements of each group entity.
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This note was uploaded on 02/22/2012 for the course ACCOUNTING 402 taught by Professor Sanaabadry during the Spring '12 term at DISD.

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IFRIC11 BV2009 - IFRIC 11 IFRIC Interpretation 11 IFRS...

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