Scope of Employee Benefits :
1. This Standard should be applied by an employer in accounting for all employee benefits, except employee share-based payments2 . 2. This Standard does not deal with accounting and reporting by employee benefit plans. 3. The employee benefits to which this Standard applies include those provided:
(a) under formal plans or other formal agreements between an enterprise and individual employees, groups of employees or their representatives;
(b) under legislative requirements, or through industry arrangements, whereby enterprises are required to contribute to state, industry or other multi-employer plans; or
(c) by those informal practices that give rise to an obligation. Informal practices give rise to an obligation where the enterprise has no realistic alternative but to pay employee benefits. An example of such an obligation is where a change in the enterprise’s informal practices would cause unacceptable damage to its relationship with employees.
4. Employee benefits include:
(a) short-term employee benefits, such as wages, salaries and social security contributions (e.g., contribution to an insurance company by an employer to pay for medical care of its employees), paid annual leave, profit-sharing and bonuses (if payable within twelve months of the end of the period) and non-monetary benefits (such as medical care, housing, cars and free or subsidised goods or services) for current employees;
(b) post-employment benefits such as gratuity, pension, other retirement benefits, post-employment life insurance and post employment medical care;
(c) other long-term employee benefits, including long-service leave or sabbatical leave, jubilee or other long-service benefits, long-term disability benefits and, if they are not payable wholly within twelve months after the end of the period, profit-sharing, bonuses and deferred compensation; and
(d) termination benefits.
Because each category identified in (a) to (d) above has different characteristics, this Standard establishes separate requirements for each category
5. Employee benefits include benefits provided to either employees or their spouses, children or other dependants and may be settled by payments (or the provision of goods or services) made either:
(a) directly to the employees, to their spouses, children or other dependants, or to their legal heirs or nominees; or
(b) to others, such as trusts, insurance companies.
6. An employee may provide services to an enterprise on a full-time, part-time, permanent, casual or temporary basis. For the purpose of this Standard, employees include whole-time directors and other management personnel.