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Compliance April 10, 2013
IASB Issues Proposal for Recognizing Employee Contributions
April 10, 2013 (PLANSPONSOR.com) - The International Accounting Standards Board (IASB) has proposed amendments to IAS 19, Employee Benefits.
Reported by PLANSPONSOR staff
The proposal addresses the accounting for contributions from employees or third parties when the requirement for such contributions is set out in the formal terms of a defined benefit (DB) plan. It proposes that such contributions may be recognized as a reduction in the service cost in the same period in which they are payable if, and only if, they are linked solely to the employee’s service rendered in that period.
An example would be contributions that are a fixed percentage of an employee’s salary, so the percentage of the employee’s salary does not depend on the employee’s number of years of service to the employer.
The IASB invites comments on the proposals. Comments should be submitted in writing by July 25, 2013.
An Exposure Draft of the proposals is here.