Overview
IAS 19 – Employees benefits applies to all employee benefits, except for those covered by IFRS 2 – Share-based Payment, and this standard does not apply to reporting for the Employee Welfare Fund.
As a basic rule, the standard states the following:
(a) A liability should be recognized when an employee has provided a service in exchange for benefits to be received by the employee sometime in the future.
(b) An expense should be recognized when the entity consumes the economic benefits from a service provided by an employee in exchange for employee benefits.
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