Insights into MFRS 2

Modifications and cancellations of share-based payment arrangements with employees (Part 1)

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Share-based payments have become increasingly popular over the years, with many entities using equity instruments or cash and other assets based on the value of equity instruments as a form of payment to directors, senior management, employees and other suppliers of goods and services.

While the general accounting principles have remained largely unchanged since the introduction of MFRS 2 ‘Share-based Payment’ in 2004, share-based payments is an area that is not well understood in practice and entities often have difficulty in applying the requirements to increasingly complex and innovative share-based payment arrangements.

Our ‘Insights into MFRS 2’ series is aimed at demystifying MFRS 2 by explaining the fundamentals of accounting for share-based payments using relatively simple language and providing insights to help entities cut through some of the complexities associated with accounting for these types of arrangements.

In this Part I of the article, it explains and provides examples of the accounting treatment for modifications and cancellations of share-based payment arrangements with employees.

Insights into MFRS 2

Insights into MFRS 2

Modifications and cancellations of share-based payment arrangements with employees

Read our article to understand more.

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How we can help

We hope you find the information in this article helpful in giving you some insight into MFRS 2. If you would like to discuss any of the points raised, please do not hesitate to contact us.