The International Financial Reporting Standards (IFRSs) are developed by The International Accounting Standards Board (IASB) which was formed in 2001 to replace the International Accounting Standards Committee. IASB is a private sector body that works independently to develop and approve the international standards. IASB operates under IFRS foundation. The IFRS Foundation was formed to “develop a single set of high quality, understandable, enforceable and globally accepted international financial reporting standards (IFRSs) through its standard-setting body, the IASB (FASB, 2002)”. The Financial Accounting Standards Board (FASB) was established to set the financial accounting standards in the United States of America for nongovernmental entities. The Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants acknowledge the authority of these standards (FASB, 2002).
Exposure drafts discuss the standards and rulings that are being contemplated through pending discussion drafts and exposure documents of FASB and IASB. An exposure ...
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...easurement of share-based payment transactions and to clarify how to account for certain types of share-based payment transactions.
The amendments will be effective for annual periods beginning on or after 1 January 2018 (IFRS, 2014).
Three main areas are discussed in the exposure draft.
• The effects of vesting conditions on the measurement of a cash-settled share-based payment transaction
• The classification of a share-based payment transaction with net settlement features for withholding tax obligations
• The accounting where a modification to the terms and conditions of a share-based payment transaction changes its classification from cash-settled to equity-settled (IFRS, 2014).
The retrospective application is permitted if all three amendments are elected and meeting other criteria, however the application should not restate the prior periods (EY, 2016).
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