INTERNATIONAL STANDARD 19 Analysis

INTRODUCTION

With the overview of IFRS, enterprises that reports rendering to international standards are obligatory to trail INTERNATIONAL ACCOUNTING STANDARD 19 Employee Benefits. Employee benefits classically establish a significant module of an entity’s expenses, particularly in the service sector. Workforces are remunerated for the services they deliver. In addition to the steady wages which may be paid weekly, fortnightly or monthly, employment agreements often provide for prerogatives to be paid, such as sick leave, annual leave, long service leave and contributions for post-employment benefits, often referred to as superannuation plans or pension plans. Paragraph 7 of INTERNATIONAL ACCOUNTING STANDARD 19 defines employee benefits as; “all forms of consideration given by an entity

[INTERNATIONAL ACCOUNTING STANDARD 19- Employee Benefits (2011)]

SCOPE OF INTERNATIONAL ACCOUNTING STANDARD 19

INTERNATIONAL ACCOUNTING STANDARD 19 employee benefits are functional to all employee benefits except for those to which IFRS 2 Share-based Payment applies (http://www.iasplus.com/en/standards/ifrs/ifrs2). Employee benefits arise from official an agreement which is also known as workplace agreements between an employer and employee. Employee benefits also embrace necessities specified by legislation or industry provisions for employers to contribute to an industry, state or national plan. Informal practices that generate a constructive obligation such as payment of annual bonuses fall in the scope of INTERNATIONAL ACCOUNTING STANDARD 19. Share-based employee benefits are outside the scope of INTERNATIONAL ACCOUNTING STANDARD