[et_pb_section admin_label=”Header – All Pages” global_module=”1221″ transparent_background=”off” background_color=”#1e73be” allow_player_pause=”off” inner_shadow=”off” parallax=”off” parallax_method=”off” padding_mobile=”off” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” make_equal=”off” use_custom_gutter=”off” gutter_width=”3″ custom_padding=”||0px|”][et_pb_row global_parent=”1221″ admin_label=”row”][et_pb_column type=”4_4″][et_pb_post_title global_parent=”1221″ admin_label=”Post Title” title=”on” meta=”off” author=”on” date=”on” categories=”on” comments=”on” featured_image=”off” featured_placement=”below” parallax_effect=”on” parallax_method=”on” text_orientation=”left” text_color=”light” text_background=”off” text_bg_color=”rgba(255,255,255,0.9)” module_bg_color=”rgba(255,255,255,0)” title_all_caps=”off” use_border_color=”off” border_color=”#ffffff” border_style=”solid” title_font=”|on|||” title_font_size=”35″ custom_padding=”10px|||”] [/et_pb_post_title][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section admin_label=”Section” global_module=”1228″ fullwidth=”off” specialty=”off” transparent_background=”off” allow_player_pause=”off” inner_shadow=”off” parallax=”off” parallax_method=”off” custom_padding=”0px||0px|” padding_mobile=”on” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” make_equal=”off” use_custom_gutter=”off” gutter_width=”3″][et_pb_row global_parent=”1228″ admin_label=”Row” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” use_custom_gutter=”off” gutter_width=”3″ custom_padding=”0px||0px|” padding_mobile=”off” allow_player_pause=”off” parallax=”off” parallax_method=”off” make_equal=”off” parallax_1=”off” parallax_method_1=”off” column_padding_mobile=”on”][et_pb_column type=”4_4″][et_pb_text global_parent=”1228″ admin_label=”Text” background_layout=”light” text_orientation=”left” text_font_size=”14″ use_border_color=”off” border_color=”#ffffff” border_style=”solid”] [breadcrumb] [/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section admin_label=”Section” fullwidth=”off” specialty=”off”][et_pb_row admin_label=”Row”][et_pb_column type=”1_2″][et_pb_text admin_label=”Text” background_layout=”light” text_orientation=”center” use_border_color=”off” border_color=”#ffffff” border_style=”solid”] [button link=”https://ie.frs102.com/members/premium-toolkit/” type=”big” color=”red”] Return to Main Index[/button] [/et_pb_text][/et_pb_column][et_pb_column type=”1_2″][et_pb_text admin_label=”Text” background_layout=”light” text_orientation=”center” use_border_color=”off” border_color=”#ffffff” border_style=”solid”] [button link=”https://ie.frs102.com/members/premium-toolkit/section-26/” type=”big” color=”red”] Return to Section 26 Home[/button] [/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section admin_label=”Section” fullwidth=”off” specialty=”off” transparent_background=”off” allow_player_pause=”off” inner_shadow=”off” parallax=”off” parallax_method=”off” padding_mobile=”off” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” make_equal=”off” use_custom_gutter=”off” gutter_width=”3″][et_pb_row admin_label=”Row”][et_pb_column type=”4_4″][et_pb_text admin_label=”Main Body Text” background_layout=”light” text_orientation=”justified” use_border_color=”off” border_color=”#ffffff” border_style=”solid”]
Disclosures
Extract from FRS102: Section 26.18 – 26.23.
26.18 An entity shall disclose the following information about the nature and extent of share-based payment arrangements that existed during the period:
(a) A description of each type of share-based payment arrangement that existed at any time during the period, including the general terms and conditions of each arrangement, such as vesting requirements, the maximum term of options granted, and the method of settlement (eg whether in cash or equity). An entity with substantially similar types of share-based payment arrangements may aggregate this information.
(b) The number and weighted average exercise prices of share options for each of the following groups of options:
(i) outstanding at the beginning of the period;
(ii) granted during the period;
(iii) forfeited during the period;
(iv) exercised during the period;
(v) expired during the period;
(vi) outstanding at the end of the period; and
(vii) exercisable at the end of the period
26.19 For equity-settled share-based payment arrangements, an entity shall disclose information about how it measured the fair value of goods or services received or the value of the equity instruments granted. If a valuation methodology was used, the entity shall disclose the method and its reason for choosing it.
26.20 For cash-settled share-based payment arrangements, an entity shall disclose information about how the liability was measured.
26.21 For share-based payment arrangements that were modified during the period, an entity shall disclose an explanation of those modifications.
26.22 If the entity is part of a group share-based payment plan, and it recognises and measures its share-based payment expense on the basis of a reasonable allocation of the expense recognised for the group, it shall disclose that fact and the basis for the allocation (see paragraph 26.16).
26.23 An entity shall disclose the following information about the effect of share-based payment transactions on the entity’s profit or loss for the period and on its financial position:
(a) the total expense recognised in profit or loss for the period; and
(b) the total carrying amount at the end of the period for liabilities arising from share-based payment transactions.
OmniPro comment
See illustration below the above requirements
Example 28: Extract from the accounting policy notes
Share based costs
The company participates in a number of equity-settled, share based compensation plans operated by its parent company, XXXXX Limited. The fair value of the employee services received in exchange for the grant of the options or shares is recognised as an expense. The parent undertaking does not immediately recharge the company for these expenses so they are shown as a capital contribution/share based payment reserves from the parent undertaking within other reserves. Where any subsequent recharge is not, in the opinion of the directors, clearly linked to the share based payment charge, the amount is treated in a manner similar to a management recharge.
The total amount to be expensed over the vesting period is determined by reference to the fair value of the options, shares or Restricted Stock Units (RSUs) granted, excluding the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of options or shares that are expected to vest. At each balance sheet date, the entity revised its estimates of the number of options of shares that are expected to vest. It recognises the impact of the revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity.
Fair value of options is measured using the Black Scholes model.
OR
The fair value of shares awarded under the XXX plan are determined using a Monte Carlo simulation technique. The plan contains inter alia a Total Shareholder Return (TSR) based (and hence market-based) vesting condition and, accordingly, the fair value assigned to the related equity instruments on initial application of Section 26 is adjusted so as to reflect the anticipated likelihood at the grant date of achieving the market-based vesting condition.
OR
The company operates a share appreciation rights scheme whereby senior management are offered share appreciation rights. This scheme provides the employees with the right to receive, at the date the rights are exercised, cash equal to the appreciation in the entity’s share price since the grant date. The rights vest within 3-5 years of being granted. For cash-settled share-based payment transactions, the company measures the goods or services acquired and the liability incurred at the fair value of the liability. Until the liability is settled, the company remeasures the fair value of the liability at each reporting date and at the date of settlement, with any changes in fair value recognised in profit or loss for the period.
The fair value is measured by reference to the price quoted on the stock exchange OR the fair value is measured by using the Black Scholes model OR an Option pricing model.
The carrying amount of the liability with regard to these share appreciation rights is disclosed in note X to the financial statements.
Example 29: Extract from the notes to the financial statements
Share based payments
The ultimate parent company XXXXXX. provides employees, on a discretionary basis, with share options and restricted stock (the ‘Awards’) that need to be accounted for under Section 26 “Share based payments”.
Awards are granted to directors and selected employees. Awards are conditional on the employee completing a specified period of service (the vesting period) and have a contractual term of five years. The ultimate Parent has no legal or constructive obligation to repurchase or settle the Awards in cash. The exercise price for stock options may not be less than the fair market value of the underlying stock at the date of grant and options generally will expire no later than XXX years after the date on which they are granted.
A summary of the movements in the number of share options outstanding and their related weighted average exercise prices are as follows:
|
|
2015 |
2014 |
||
|
Options |
Number |
Weighted average price |
Number |
Weighted average price |
|
|
|
CU |
|
CU |
|
|
|
|
|
|
|
Outstanding at 1 January |
– |
– |
XXX |
XXX |
|
Granted |
– |
– |
– |
– |
|
Forfeited |
– |
– |
– |
– |
|
Expired |
– |
– |
– |
– |
|
Exercised |
– |
– |
(XXX) |
XXX |
|
Outstanding at 31 December |
– |
– |
– |
– |
|
|
|
|
|
|
|
Exercisable at 31 December |
– |
– |
– |
– |
Restricted stock units
A summary of the movements in the number of restricted stock units outstanding and their related weighted average exercise prices are as follows:
|
|
2015 |
2014 |
||
|
|
Number |
Weighted average fair value |
Number |
Weighted average fair value |
|
|
|
CU |
|
CU |
|
|
|
|
|
|
|
Outstanding at 1 January |
XXX |
XXX |
XXXX |
XXXX |
|
Granted |
XXX |
XXX |
XXXX |
XXXX |
|
Forfeited |
– |
– |
– |
– |
|
Exercised |
(XXX) |
XXX |
(XXXX) |
XXXX |
|
Outstanding at 31 December |
XXX |
XXX |
XXXX |
XXXX |
|
|
|
|
|
|
|
Exercisable at 31 December |
– |
– |
– |
– |
The total charge in the year relating to employee share based payment plans was CUXXXX (2014: CUXXX) all of which related to equity settled share based payment transactions.
IF APPLICABLE INCLUDE THE BELOW
Of the CUXXXX, CUXXX relates to the 2015 Section 26 charge and CUXXX relates to a recharge from group. The CUXXX is not directly attributable to shares and therefore treated as a management recharge in accordance with XXXX Limited accounting policy.
[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]