Amendments to IAS 19 and IFRIC 14 proposed
On 18 June 2015, the IASB published for comment exposure draft ED/2015/5 Remeasurement on Plan Amendment, Curtailment or Settlement/ Availability of refund from a Defined benefit Plan of proposed amendments to IAS 19 – Employee Benefits and IFRIC 14 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction.
Keywords: Mazars, Thailand, Accounting, IFRS, IASB, IAS 19, IFRIC 14, Employee Benefits
25 August 2015
The proposals are the fruit of discussions within the IFRS IC, and aim to clarify:
- The requirements of IAS 19 regarding the impact of a plan amendment, curtailment or settlement on the determination of service cost and net interest. The current standard requires an entity to determine the impact of a plan amendment, curtailment or settlement by using the actuarial assumptions and fair value of plan assets at the time of such an event (i.e. a plan amendment, curtailment or settlement). However, it does not explain how such a remeasurement would affect the determination of service cost and net interest in the period following the event. The amendment proposes to clarify that an entity should determine service cost and net interest for the remaining period (i.e. the period following the event) by using the updated assumptions used in the more recent measurement.
- The requirements of IFRIC 14 for situations where an entity’s unconditional right to a refund of a surplus is limited by other parties’ (e.g. pension trustees’) power to increase benefits or wind up a plan, and the impact on recognition of assets.
The comment period is open until 19 October 2015. The exposure draft can be accessed on the IASB’s website .