3. MEANING OF IAS:19
▪IAS:19 refers to International Accounting Standard
19, which deals with Accounting For employee benefits. It
outline how companies should account’s for various types of
employee benefits
▪ Such as pensions, Post-employment benefits and other
long-term employee benefits
4. DEFINITION:
▪IAS 19, formally known as International Accounting
Standard 19,is a Standard developed by the International
Accounting Standards Board (IASB) that provides
guidelines for the Accounting treatment and disclosure of
employee benefits .This standard Covers a wide range of
employee benefits, including short-term benefits such as
wages and salaries, as well as long-term benefits such as
pensions post-employment healthcare, and other
retirement benefits. The purpose of IAS 19 is to ensure that
companies
5. OBJECTIVE
1.Provide Accurate Financial Reporting:
▪ It refers the Ensure that financial statements accurately reflect the costs and obligations related to employee
benefits,such as pensions,post-employment healthcare,and other similar benefits
2. Enhance Transparency
▪ Promote Transparency by requiring clear and comprehensive disclosure of the nature,amount,and financial
impact of employee benefits obligations and cost
3. Assist Decision Making
▪ Helps users of financial statements,such as investors, creditors, and other stakeholders, make informed
decisions by providing relevant and reliable information about the Entity financial position, performance,
and cash flows related to employee benefits
6. 4.Ensure Compliance:
▪ Ensure that entities comply with Accounting Standards and principles when
recognizing, measuring, and disclosing employee benefits costs and obligations
5.Promote comparability:
▪ Facilitate comparability between entities by establishing consistent Accounting and
disclosure requirements fir employee benefits, there by enabling users to evaluate
and compare different entities financial statements more effectively
6.Protect stakeholders:
▪ safeguard to the interests of employees, investors, creditors and other stakeholders by
promoting sound financial Reporting practices and transparency regarding employee
benefits obligations
OBJECTIVE
7. FEATURE OF IAS-19
1.Scope
▪ It applies to all employee benefits, including short-term employee benefits, post-
employment benefits such as pensions, other long-term employee benefits, and
termination benefits
2. Recognition and Measurement
▪ It outline the principles for recognizing and measuring employee benefits
including determining the present value of defined benefit obligations and the fair
value of plan assets for defined benefits plans.
3. Defined Benefits plans vs. Defined contribution plans:
▪ It distinguishes between defined benefits plans, where the employer bears the risk
associated with providing the benefits and defined contribution plans, where the
employer’s obligations is limited to making specified contribution
8. 4.Actuarial Assumption:
▪ IAS 19 requires entities to make various actuarial Assumption when
measuring defined benefits obligations such as defined benefits
obligations , such as discount rates, expected salary increases
5. Net Interest Cost:
▪ It requires the separation of the next interest Cost of the defined
benefits liability or asset from other components of the cost, such as
service cost and remeasurements
FEATURES OF IAS-19
9. IMPORTANCE OF IAS-19
1.Financial Reporting Transparency:
▪ It ensures Transparency in financial reporting by requiring companies to accurately
account for and disclose their employee benefits obligations This helps stakeholders,
including investors and creditors, to understand the financial health and obligations of
the company
2. Accurate Measurement of liabilities:
▪ IAS 19 provides guidelines for the Measurement of employee benefits obligations,
particularly for defined benefits plans using actuarial assumptions and appropriate
discount
3. Consistency in Reporting:
▪ Standardizing the accounting treatment of employee benefits across companies ensures
consistency in reporting. This allow for better comparability between companies with in
same industry
10. 4.Management of Human Resources costs:
▪ Compliance with IAS 19 encourages companies to effectively manage their
human resources costs by evaluating the financial implications of employee
benefits plans. This can lead better decision Making
5.Enhanced stakeholders confidence:
▪ Adhering to IAS 19 requirements enhances stakeholders confidence in the
financial statements,as it demonstrates a commitment to transparent and
accurate reporting practice, This can positively impact relationship with
investors, creditors, employees, and regulatory authorities
IMPORTANCE OF IAS-19
13. MEANING OF IAS-27
▪IAS 27 refers to the International Accounting Standard 27,titled
“Consolidate and Separate Financial statements. It outline the
requirements for preparing consolidated financial statements,
which combine the financial information of a parent company and
it’s subsidiaries.
▪It also provides guidance on preparing separate financial
statements for the parent company, in cases where consolidated
statements are not required
14. ▪IAS-27 also known as International Accounting Standard
issued by the International Accounting Standard Board
(IASB) that outlines the requirements for the preparation
and presentation of consolidated financial statements.
Consolidated financial statements are financial statements
of a group of entities that are presented as those of a single
economic entity. The Standard provides guidance on how to
account for investment in subsidiaries, joint venture, and
associates, as well as the requirements for the preparation
of consolidated financial statements when an entity control
one or more other
DEFINITION OF IAS-27
