MFRS

Insights into MFRS 2: Group share-based payments

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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.

As discussed in our article ‘Insights into MFRS 2 – What is MFRS 2?’, MFRS 2 applies to share-based payment arrangements between (a) an entity, another group entity, or a shareholder of any group entity, and (b) another party, such as an employee. Other articles in the series discuss the accounting for share-based payments when employees (or others) receive shares or rights to shares of the entity granting the award.

This article discusses the accounting for share-based payment transactions when employees of an entity receive shares or rights to shares in another entity within the consolidated group, such as the parent entity.

MFRS 2: Group share-based payments

MFRS 2: Group share-based payments

This article discusses the accounting for share-based payment transactions when employees of an entity receive shares or rights to shares in another entity within the consolidated group, such as the parent entity.

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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.