accounting standard 15 revised

8/17/2019 Accounting Standard 15 Revised

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K K Mankeshwar & Co.

Chartered Accountants

CLIENT ___________________________________________ YEAR ENDED______________

AS 15 - EMPLOYEE BENEFITS CHECKLIST

Yes N

o

Qualify? Sch

no :

Ref

1. Applicability:

1.1 Are the equity or debt securities of theenterprise listed on any stock exchange in or

outside India?

1.2 Has the enterprise passed a BoardResolution to get its equity or debtsecurities listed on any stockexchange in or outside India?

1.3 Is it a commercial, industrial or business

enterprise haing a turnoer !excluding other income" in excess of #s $% crores for the

immediately preceding reporting period onthe basis of the audited financial statements?

1.& Is it a bank !including co'operatie bank",financial institution or an insurance

company?

1.$ Is it a commercial, industrial or business

enterprise haing borro(ings, including

public deposits, exceeding #s. 1%crores at any time during the reporting

period?1.) Is the enterprise, a holding or subsidiary of

any of the aboe entities?

1.* If t! a"#$!% t& a"y &f t! ab&'! i# i" t!

affi%(ati'!) t! Sta"*a%* $&+l* apply i"

!"ti%!ty.

1.+ Is an enterprise not coered by 1.1 to 1.) as

enumerated aboe a"* t! a'!%a,!"+(b!% &f p!%#&"# !(pl&y!* *+%i",

t! y!a% i# 5 &% (&%!

1. If the ans(er to 1.+ aboe is in the

affirmatie, the -tandard (ould apply,i" it# !"ti%!ty !/c!pt f&% t!

f&ll&$i",:

a. aragraphs 11 to 1) of the -tandard to the

extent they deal (ith the recognition and

measurement principles of #&%t-t!%(

acc+(+lati", c&(p!"#at!* ab#!"c!# $ic

a%! "&"-'!#ti",.

1


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Yes N

o

Qualify? Sch

no :

Ref

b. aragraphs &) and 13 of the -tandard (hichdeal (ith the *i#c&+"ti", &f a(&+"t# $icfall *+! (&%! ta" 10 (&"t# aft!% t!

Bala"c! S!!t *at!.

c. /he recognition and measurement principles

laid do(n in paragraphs $% to 11) and the presentation and disclosure requirements laid

do(n in paragraphs 11* to 123 of the

-tandard in respect of accounting for defined

benefit plans, except as indicated hereunder.

d. /he recognition and measurement principles

laid do(n in paragraphs 12 to 131 of the-tandard in respect of accounting for other

long'term employee benefits, except as

indicated hereunder0

For the purpose of para 1.9.c and 1.9.d

above, the accrued liability in respect of

defined benefit plans and other lon!ter"

e"ployee benefits should be actuarially

deter"ined and provided for as follo#s:

• $he %ro&ected 'nit (redit )ethod is

used for actuarial valuation and

• $he discount rate used is deter"ined

by reference to "ar*et yields at the

+alance Sheet date on overn"ent bonds.

1.1 Is an enterprise not coered by 1.1 to 1.) asenumerated aboe a"* t! a'!%a,!

"+(b!% &f p!%#&"# !(pl&y!* *+%i",

t! y!a% i# l!## ta" 5

1.11 If the ans(er to 1.1% aboe is in the

affirmatie, the -tandard (ould apply,

i" it# !"ti%!ty !/c!pt f&% t!

f&ll&$i",:

a. aragraphs 11 to 1) of the -tandard to the

extent they deal (ith the recognition andmeasurement principles of #&%t-t!%(acc+(+lati", c&(p!"#at!* ab#!"c!# $ic

a%! "&"-'!#ti",.

b. aragraphs &) and 13 of the -tandard (hichdeal (ith the *i#c&+"ti", &f a(&+"t# tat

fall *+! (&%! ta" 10 (&"t# aft!% t!

Bala"c! S!!t *at!.

2


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Yes N

o

Qualify? Sch

no :

Ref

c. /he recognition and measurement principleslaid do(n in paragraphs $% to 11) and the

presentation and disclosure requirements laid

do(n in paragraphs 11* to 123 of the-tandard in respect of accounting for defined

benefit plans, except as indicated hereunder.

d. /he recognition and measurement principles

laid do(n in paragraphs 12 to 131 of the

-tandard in respect of accounting for other

long'term employee benefits, except asindicated hereunder.

For the purpose of para 1.11c and 1.11d

above, the accrued liability in respect

of defined benefit plans and other

lon!ter" e"ployee benefits should be

calculated and accounted by reference

to so"e other rational "ethod.

1.10 If an enterprise subsequently ceases to be

coered by paras 1.1 to 1.) earlier, for

t$& c&"#!c+ti'! y!a%#, only then the

exemptions aailable in para 1. (ouldapply.

1.13 If an enterprise subsequently qualifies for exemptions coered by para 1.11

aboe, for t$& c&"#!c+ti'! y!a%#, only

then the exemptions aailable in para1.11 (ould apply.

1.1& If an enterprise subsequently ceases to bequalified for exemptions coered by

paras 1. and 1.11 aboe in the current

accounting period, then the Sta"*a%*

appli!# i" it# !"ti%!ty !/c!pt

!/!(pti&"# c&'!%!* by 1. a# t! ca#!

(ay b! f%&( t! c+%%!"t p!%i&*.

T! c&%%!#p&"*i", p%!'i&+# p!%i&* fi,+%!#

i" %!#p!ct &f t! %!l!'a"t *i#cl+%!#

"!!* "&t b! p%&'i*!*.

1.1$ here exemptions hae been aailed as

coered by paras 1. and 1.11 aboe,

the fact must be disclosed.

In case of exemptions coered by para 1.11,the method used to calculate and account for

accrued liability must be disclosed.

3


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Yes N

o

Qualify? Sch

no :

Ref

0 Sc&p!

2.1 oes the nterprise proide mployee

4enefits under any of the follo(ing0• 5ormal plans or other formal

agreements bet(een an enterprise andindiidual employees, groups of

employees or their representaties.

• 6egislatie requirements, or through

industry arrangements, (hereby

enterprises are required to contributeto state, industry or other multi'

employer plans.

• Informal practices that gie rise to an

obligation (here the enterprise has norealistic alternatie but to pay

employee benefits.

2.2 If the ans(er to any of the aboe is yes, the

-tandard (ould apply to the aforesaid items.

2.3 • /his -tatement should be applied by

an employer in accounting for all

employee benefits, !/c!pt !(pl&y!!

#a%!-ba#!* pay(!"t#.

$he accountin for such benefits is

dealt #ith in the uidance Note on

-ccountin for "ployee Share!

based %ay"ents issued by the

/nstitute of (hartered -ccountants

of /ndia.

• /his -tatement does not deal (ith

accounting and reporting by employee

benefit plans.

2.& mployee 4enefits include0

• -hort /erm mployee 4enefits

• ost 7 mployment 4enefits

•8ther 6ong /erm mployee 4enefits

• /ermination 4enefits

2.$ mployee benefits include benefits proided

to either employees or their spouses,children or other dependants and may

be settled by payments made either0

!a" directly to the employees, to their spouses,

children or other dependants, or to their

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Ref

legal heirs or nominees9 or !b" to others, such as trusts, insurance

companies.

2.) An employee may proide serices to an

enterprise on a full'time, part time,

permanent, casual or temporary basis.5or the purpose of this -tatement, !(pl&y!!#

i"cl+*! $&l!-ti(! *i%!ct&%# a"*

&t!% (a"a,!(!"t p!%#&""!l.

2 SHO3T TE3M EMPLOYEE BENEFITS

2.1 4ased on our +"*!%#ta"*i", &f t! pay%&ll

b+#i"!## cycl! of the enterprise, the

reie( of !(pl&y!!# a"* b&&4) H.3.

p&lici!#, Mi"+t!# &f t!C&(p!"#ati&" C&((itt!!, if any,

reie( of the prior year (orking

papers, t! l!,al #tat+t!# applicabl!etc. ascertain (hether any of the

follo(ing employee benefits hae been

proided?

!a" (ages, salaries and social securitycontributions9

!b" short'term compensated absences !such as

paid annual leae" (here the ab#!"c!# a%!

!/p!ct!* t& &cc+% $iti" t$!l'! (&"t#

aft!% t! !"* &f t! p!%i&* in (hich the

employees render the related employeeserice9

!c" profit'sharing and bonuses payabl!$iti" t$!l'! (&"t# aft!% t! !"* &f t!

p!%i&* in (hich the employees render therelated serice9 and

!d" non'monetary benefits !such as medical

care, housing, cars and free or subsidisedgoods or serices" for current employees.

2.0 If the ans(er to any of the items coered by para 3.1 aboe is in the affirmatie,

then such employee benefits need to be

classified as S&%t T!%( E(pl&y!!

B!"!fit#.

2.2 3!c&,"iti&" a"* M!a#+%!(!"t:

nsure that the short term employee benefitsare measured on an +"*i#c&+"t!*

$


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Yes N

o

Qualify? Sch

no :

Ref

ba#i# and are recognised0

• As acc%+!* !/p!"#!#p%!pai*

!/p!"#!# as the case may be, based onthe amount of benefit is':'is the

amount already paid9 and

• As !/p!"#!#, unless any other

accounting standard permits the

inclusion of benefits in the cost of anasset.

2.6 S&%t T!%( C&(p!"#at!* Ab#!"c!#

2.6.1 Ascertain (hether the short term

compensated absences are acc+(+lati",, i.e.

(hether the absences can be carried for(ard

and can be used in future periods if thecurrent period;s entitlement is not used in

full?

2.6.0 • If the ans(er to para 3.&.1 aboe is in

the affirmatie, ensure that the

enterprise recognises the expectedcost of employee benefits (hen the

employees render serice that

increases their entitlement to futurecompensated absences.

• nsure that the obligation is

recognised, irrespectie of the fact(hether the compensated absences areesting or non' esting.

Vesting absences are those when employees

are entitled to a cash payment for unused entitlement on leaving the enterprise and non

– vesting absences are those when employees

are not entitled to a cash payment for unused entitlement on leaving.

2.6.2 nsure that the enterprise measures the

obligation at the amount of the additional

payments that are expected to arise solelyfrom the fact that the benefit accumulates.

2.6.6 In case of "&"-acc+(+lati", compensated

absences, ensure that the enterprise

recognises the expected cost of employee benefits only (hen the absences occur, e.g.


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Yes N

o

Qualify? Sch

no :

Ref

2.5.1 • Ascertain (hether the enterprise has

"& %!ali#tic alt!%"ati'! b+t t& (a4!

pay(!"t# on account of profitsharing and bonus as a result of past

eents 9 and

• Ascertain (hether a %!liabl! !#ti(at!

of such payments can be made?

2.5.0 a. Is there a formula for determining the

amount of bonus=share of profit,

(hich has been documented? b. >as the enterprise determined the

amounts to be paid before the

financial statements are approed?

c. oes the past practice gie clear eidence of the amount of the

enterprise;s obligation?

O"ly if t! a"#$!% t& a"y &f t! p&i"t#

ab&'! i# i" t! affi%(ati'!) t! !"t!%p%i#!

ca" (a4! a %!liabl! !#ti(at! &f t!

pay(!"t# t& b! (a*!.

2.5.2 If the ans(er to para 3.$.1 aboe is in

affirmatie, ensure that the enterprise has

recognised the expected cost of such benefitas an expense for the period.

2.7 8i#cl+%!#/his -tatement does not require specific

disclosures about short'term employee

benefits. >o(eer, (here other Accounting-tandards require disclosure (hether such

disclosures hae been made? 5or example,

(here required by A- 1+ #elated partydisclosures;, (hether the enterprise has

disclosed the information about employee

benefits for key management personnel?

9H&$!'!%) *i#cl+%! #&+l* b! (a*! &f t!

"at+%! &f t! #&%t t!%( !(pl&y!! b!"!fit#a"* t! acc&+"ti", p&licy a*&pt!* f&% t!

#a(!

6 POST EMPLOYMENT BENEFITS

6.1 4ased on &+% +"*!%#ta"*i", &f t! pay%&ll

b+#i"!## cycl! of the enterprise, t! %!'i!$&f !(pl&y!!# a"* b&&4) H.3. p&lici!#,

Mi"+t!# &f t! C&(p!"#ati&" C&((itt!!)

*


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Yes N

o

Qualify? Sch

no :

Ref

if any, reie( of the prior year (orking papers, the l!,al #tat+t!# applicabl! etc.

ascertain (hether any of the follo(ing

employee benefits hae been proided?

• #etirement 4enefits such as gratuity

and pension.

• 8ther 4enefits such as post

employment life insurance and postemployment medical care.

6.0 If the ans(er to any of the items coered by para &.1 aboe is in the affirmatie, then such

employee benefits need to be classified as

Pt E(pl&y(!"t B!"!fit#.

6.2.1 Are the p%i"cipal t!%(# a"* c&"*iti&"# of the post employment benefit plans such that

the &bli,ati&" &f t! !"t!%p%i#! i# %!#t%ict!*

t& t! a(&+"t tat it a,%!!# t& c&"t%ib+t!

to a fund?

6.2.0 If yes, then the post employment benefit plan

must be classified as a *!fi"!* c&"t%ib+ti&"pla".

6.6.1 oes the enterprise hae an obligation

through0

!a" a plan benefit formula that is not linked

solely to the amount of contributions9 or !b" a direct or indirect guarantee, of a

specified return on contributions9 or !c" informal practices that gie rise to an

obligation.

6.6.0 If ans(er to any of items coered by para

&.&.1. aboe is in the affirmatie, the

!"t!%p%i#!;# &bli,ati&" i# "&t %!#t%ict!* t&

t! a(&+"t it a,%!!# t& c&"t%ib+t! t& t!

f+"*.

In such cases, the post employment benefit

plan must be classified as a *!fi"!* b!"!fitpla".

5 M


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Ref

b!"!fit pla", ensure that the enterprise has

acc&+"t!* for its p%&p&%ti&"at! #a%! &f the

*!fi"!* b!"!fit &bli,ati&") pla" a##!t# a"*

ct a##&ciat!* $it t! pla" in the same(ay as for any other defined benefit plan and

has *i#cl!* the information as required by

pa%a 02.

5.2 hen sufficient i"f&%(ati&" i# "&t a'ailabl!t& +#! *!fi"!* b!"!fit acc&+"ti", for a

multiemployer plan that is a defined benefit plan and c&"#!=+!"tly acc&+"t!* as a

*!fi"!* c&"t%ib+ti&" pla", (hether the

enterprise has0!a" disclosed the fact that the plan is a

defined benefit plan?

!b" disclosed the reason (hy sufficientinformation is not aailable to enable the

enterprise to account for the plan as a

defined benefit plan?!c" to the extent that a surplus or deficit in

the plan may affect the amount of future

contributions, disclosed in addition0

i. any aailable information about thatsurplus or deficit?

ii. the basis used to determine that

surplus or deficit?9 andiii. the implications, if any, for the

enterprise?

5.6 hether contingent liabilities arising in the

context of multi'employer plans hae been

disclosed as per A- 2, @roisions,

ontingent 6iabilities and ontingentAssets@?

Be.g., any responsibility under the terms of a

plan to finance any shortfall in the plan if other enterprises cease to participateC.

7 STATE PLANS

An enterprise should account for a state plan

in the same (ay as for a multi'employer plan!#efer para $ aboe"

> INS.1 oes the enterprise pay insurance premiums

to fund a post'employment benefit plan?


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Yes N

o

Qualify? Sch

no :

Ref

>.0 If y!#, then the enterprise should treat such a plan as a *!fi"!* c&"t%ib+ti&" pla") +"l!##the enterprise %!tai"# a" &bli,ati&" to either0

a. pay the employee benefits directly(hen they fall due9 or

b. pay further amounts if the insurer

does not pay all future employee benefits relating to employee serice

in the current and prior periods.

If t! !"t!%p%i#! %!tai"# #+c &bli,ati&",

the enterprise should treat the plan as a

*!fi"!* b!"!fit pla".

? 8EFINE8 CONT3IB


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o

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no :

Ref

by A- 1+, @#elated artyisclosures;?

8EFINE8 BENEFIT PLANS

.1 Accounting for defined benefit plans is ba#!*&" act+a%ial a##+(pti&"# made to measure

the obligation and the expense and there is a possibility of actuarial gains and losses. /he obligations are (!a#+%!* &" a*i#c&+"t!* ba#i#.

.0 nsure that the enterprise has "&t &"lyaccounted for its l!,al &bli,ati&" +"*!% t!

f&%(al t!%(# of a defined benefit plan, b+t

al#& for any other &bli,ati&" tat a%i#!#

f%&( t! !"t!%p%i#!;# i"f&%(al p%actic!#.

nformal practices give rise to an obligationwhere the enterprise has no realistic

alternative but to pay employee benefits.

.2 Bala"c! S!!t

nsure that the a(&+"t %!c&,"i#!* a# a

*!fi"!* b!"!fit liability is the net total of the

follo(ing amounts0!a" the present alue of the defined benefit

obligation at the 4alance -heet date9

!b" minus any past serice cost not yetrecognised9

!c" minus the fair alue at the 4alance -heet

date of plan assets !if any" out of (hich theobligations are to be settled directly.

.2.1 8btain the copies of the Actuarial Daluation

#eport proided by an qualified actuary and0

• Derify the data (hich has been

considered by the Actuary (ith the

underlying records of the enterprise.

• 8btain a reconciliation of number of

employees at the beginning of the

year and the end of the year.• ross tally the number of employees

as per the aluation report (ith the payroll register.

.2.0 • nsure that the p%!#!"t 'al+! &f t!

*!fi"!* b!"!fit &bli,ati&" has been

*!t!%(i"!* %!,+la%ly at interals not

exceeding three years.

11


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Yes N

o

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no :

Ref

• nsure that the (t %!c!"t

'al+ati&" has been reie(ed as at the

4alance -heet date and updated for any material changes likely to affect

the aluations.

• nsure that the fai% 'al+! &f pla"

a##!t# is determined at !ac Bala"c!S!!t *at!.

.2.2 In case the amount determined under para .3

aboe is negatie, ensure that the enterprisehas measured the resulting asset at the lo(er

of0

!a" the amount determined under paragraph

.39 and!b" the present alue of any economic

benefits aailable in the form of refunds from

the plan or reductions in future contributionsto the plan.

!he present value of these economic benefits

should be determined using the discount rate specified in para 14 below.

.6 P%&fit a"* L# Acc&+"t

nsure that the enterprise has recognised thenet total of the follo(ing amounts in the

rofit and 6oss Account, except to the extentthat another Accounting -tandard requires or permits their inclusion in the cost of an asset0

a. current serice cost9

b. interest cost9c. the expected return on any plan assets

and on any reimbursement9

d. actuarial gains and losses9e. past serice cost to the extent that

para 1* belo( requires an enterprise

to recognise it9

f. the effect of any curtailments or settlements9 and

g. the effect of the limit in para .3.3

!b" , i.e., the extent to (hich theamount determined under para .3 !if

negatie" exceeds the amount

determined under para .3.3 !b".

1 P3ESENT @AL


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Yes N

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no :

Ref

BENEFIT OBLIATIONS AN8

C


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Yes N

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12 Act+a%ial A##+(pti&"#

hile making actuarial assumptions, ensure

that the actuary has considered both*!(&,%apic a##+(pti&"# and fi"a"cial

a##+(pti&"#.

12.1 8!(&,%apic a##+(pti&"# (hich deal (ith

matters such as0

i. mortality, both during and after

employment9ii. rates of employee turnoer, disability

and early retirement9

iii. the proportion of plan members (ithdependants (ho (ill be eligible for

benefits9 and

i. claim rates under medical plans9 and

Fi"a"cial a##+(pti&"# (hich deal (ith

items such as0

i. the discount rate9ii. future salary and benefit leels9

iii. in the case of medical benefits, future

medical costs, including, (here

material, the cost of administeringclaims and benefit payments9 and

i. the expected rate of return on plan

assets.

12.0 nsure that actuarial assumptions are

• neither imprudent nor excessiely

conseratie. i.e they are +"bia#!*and

• reflect the economic relationships

bet(een factors such as inflation,rates of salary increase, the return on

plan assets and discount rates. i.e.

they a%! (+t+ally c&(patibl!.

12.2 nsure that the financial assumptions are

based on market expectations, at the 4alance-heet date, for the period oer (hich theobligations are to be settled.

16 Act+a%ial A##+(pti&"#: 8i#c&+"t 3at!

• nsure that the discount rate used by

the actuary has been determined by

reference to (a%4!t yi!l*# at the

4alance -heet date &" &'!%"(!"t

1&


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no :

Ref

b&"*#.

• nsure that the currency and term of

the Eoernment bonds is consistent(ith the currency and estimated term

of the post'employment benefitobligations.

16.1 I"t!%!#t Ct

nsure that the interest cost is computed by

multiplying the discount rate as determined at

the start of the period by the present alue of the defined benefit obligation throughout that

period, taking account of any material

changes in the obligation.

15 Act+a%ial A##+(pti&"#: Sala%i!#) B!"!fit#a"* M!*ical Ct#.

15.1 nsure that the measurement of post

employment benefit obligations reflects

!#ti(at!* f+t+%! #ala%y i"c%!a#!#. "stimates of future salary increases should

ta#e account of inflation, seniority, promotion

and other relevant factors, such as supply

and demand in the employment mar#et .

15.0 If the f&%(al t!%(# &f a pla" !or an

obligation that goes beyond those terms"

%!=+i%! an enterprise to ca",! b!"!fit# i"f+t+%! p!%i&*#, ensure that the measurement

of the obligation reflects those changes.

15.2 In cases (here the post'employment benefits

are li"4!* t& 'a%iabl!# such as the leel of

#tat! %!ti%!(!"t b!"!fit# or #tat! (!*ical

ca%!) ensure that the measurement of such

benefits reflects !/p!ct!* ca",!# i" #+c

'a%iabl!#) based on pa#t i#t&%y and other

%!liabl! !'i*!"c!.

15.6 hile making assumptions about (!*ical

ct#, ensure that the enterprise hasconsidered the !#ti(at!* f+t+%! ca",!# i"t! ct &f (!*ical #!%'ic!#, resulting from both i"flati&" and #p!cific ca",!# i"

(!*ical ct#.

15.5 nsure that the enterprise has !#ti(at!*

f+t+%! (!*ical ct# &" t! ba#i# &f it# &$"i#t&%ical *ata.

1$


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no :

Ref

here considered necessary, the enterprisemay also use i#t&%ical *ata of &t!%!"t!%p%i#!#, i"#+%a"c! c&(pa"i!#, (!*ical

p%&'i*!%# or &t!% #&+%c!#.While estimating of future medical costs, the

enterprise must consider the effect of

technological advances, changes in healthcare utilisation or delivery patterns and

changes in the health status of plan

participants.

17 Act+a%ial ai"# a"* L#!#

nsure that the actuarial gains and lossesarising on account of increases or decreases

in either the present alue of a defined benefit

obligation or the fair alue of any related planassets are %!c&,"i#!* i((!*iat!ly in the

rofit and 6oss Account a# i"c&(! &%!/p!"#!.

1> Pa#t S!%'ic! Ct

>as the enterprise introduced a defined benefit plan or changed the benefits payable

under an existing defined benefit plan?

If yes, ensure that the past serice cost arisingout of such changes has been %!c&,"i#!* as

an expense on a #t%ai,t li"! ba#i# &'!% t!a'!%a,! p!%i&* until the benefits becomeested.

If the b!"!fit# '!#t i((!*iat!ly, the past

serice cost should be %!c&,"i#!*

i((!*iat!ly.

1? Fai% @al+! &f Pla" A##!t#

• hen the (a%4!t p%ic! for plan

assets is "&t a'ailabl!) ensure that thefair alue of plan assets is !#ti(at!* by *i#c&+"ti", t! !/p!ct!* f+t+%!

ca# fl&$#.• nsure that the discount rate used,

reflects both the risk associated (ith

the plan assets and the maturity or expected disposal date of those assets.

1?.1 nsure that the plan assets exclude0

• Fnpaid contributions due from the

reporting enterprise to the fund9 and

1)


17/28



Yes N

o

Qualify? Sch

no :

Ref

• Any non'transferable financial

instruments issued by the enterprise

and held by the fund.1?.0 nsure that the plan assets are reduced by anyliabilities of the fund that do not relate to

employee benefits, e.g. trade payable,

liabilities resulting from deriatie financialinstruments etc.

1?.2 Where plan assets include $ualifying

insurance policies that e%actly match theamount and timing of some or all of the

benefits payable under the plan, the fair

value of those insurance policies is deemed to

be the present value of the related obligations.

1 3!i(b+%#!(!"t#

Ascertain (hether there is a 'i%t+al c!%tai"tythat another party (ill reimburse some or all

of the expenditure required to settle a defined

benefit obligation

If yes0

• nsure that the enterprise has

recognised its right to reimbursement

as a #!pa%at! a##!t and the same has

been measured at Fai% @al+!.• nsure that the asset is treated in the

same (ay as a pla" a##!t.

• In the rofit and 6oss Account, ensure

that the !/p!"#! relating to a defined

benefit plan has been presented "!t &f t! a(&+"t %!c&,"i#!* f&% a

%!i(b+%#!(!"t.

0 3!t+%" &" Pla" A##!t#

• nsure that expected return on plan

assets has been recognised as the

component of the expense in therofit and 6oss Account.

• nsure that enterprise has determined

the expected return on plan assets on

basis of the market expectations, atthe beginning of the period, for

returns oer the entire life of the

related obligation.

1*


18/28



Yes N

o

Qualify? Sch

no :

Ref

• nsure that the difference bet(een the

expected return on plan assets and the

actual return on plan assets isrecognised as an actuarial gain or loss.

• hile determining the expected and

actual return on plan assets, ensure

that the enterprise has deducted the

expected administration costs, other

than those included in the actuarialassumptions used to measure the

obligation.

01 C+%tail(!"t# a"* S!ttl!(!"t#

01.1 Is the enterprise required to0

a. make a (at!%ial %!*+cti&" in the"+(b!% &f !(pl&y!!# coered by a

plan, due to the requirement of a

statute=regulator or other(ise9 or

b. amend the terms of a defined benefit

plan such that a (at!%ial !l!(!"t &f

f+t+%! #!%'ic! by current employees(ill "& l&",!% =+alify f&% b!"!fit#,

or (ill =+alify only f&% %!*+c!*b!"!fit#.

If yes, then there is c+%tail(!"t of employee

benefits.01.0 >as the enterprise entered into a transactionthat !li(i"at!# all f+%t!% &bli,ati&"# for

part or all of the benefits proided under a

defined benefit plan.If yes, then there is a #!ttl!(!"t of employee

benefits.

01.6 nsure that the enterprise has %!c&,"i#!* the

,ai"# &% l#!# on the curtailment or

settlement $!" t! c+%tail(!"t &%

#!ttl!(!"t &cc+%#.

01.5 nsure that the gain or loss on a curtailmentor settlement comprise0!a" any resulting change in the present alue

of the defined benefit obligation9

!b" any resulting change in the fair alue of the plan assets9

!c" any related past serice cost that had not

preiously been recognised.

1+


19/28



Yes N

o

Qualify? Sch

no :

Ref

01.7 4efore determining the effect of a curtailmentor settlement, ensure that the enterprise has

remeasured the obligation !and the related

plan assets, if any" using current actuarialassumptions.

00 P%!#!"tati&" - Off#!toes the enterprise0

!a" hae a legally enforceable right to use a

surplus in one plan to settle obligations under the other plan?

!b" intend either to settle the obligations on a

net basis, or to realise the surplus in one planand settle its obligation under the other plan

simultaneously?If yes, the enterprise can offset an assetrelating to one plan against a liability relating

to another plan.

02 8i#cl+%!# hether the enterprise has disclosed thefollo(ing information about defined benefit plans0!i" information that enables users of financial statements to ealuate0

!a" the nature of the plans?

!b" the financial effects of changes in those plans during the period?

!ii" the enterprise@s accounting policy for

recognising actuarial gains and losses?!iii" a general description of the type of plans?

Note: tem &iii' distinguishes, for e%ample, flat salary pension plans from final salary

pension plans and from post(employment

medical plans. !he description of the plan should include informal practices that give

rise to other obligations included in the

measurement of the defined benefit obligationin accordance with para )* of + 1) &revised

-)'.!i" a reconciliation of opening and closing balances of the present alue of the defined benefit obligations sho(ing separately, if applicable, the effects during the periodattributable to each of the follo(ing0

1


20/28



Yes N

o

Qualify? Sch

no :

Ref

!a" current serice cost?

!b" interest cost?

!c" contributions by plan participants?

!d" actuarial gains and losses?

!e" foreign currency exchange rate on plans measured in a currency from theenterprise@s reporting currency?

!f" benefits paid?

!g" past serice cost?

!h" amalgamations?

!i" curtailments?

!G" settlements?

!" an analysis of the defined benefit

obligation into amounts arising from plansthat are unfunded and amounts arising from plans that are (holly or partly funded?!i" a reconciliation of the opening andclosing balances of the fair alue of planassets and of the opening and closing balances of any reimbursement rightrecogniHed as an asset in accordance (ith para 1%3 of A- 1$ !reised 2%%$" sho(ingseparately, if applicable, the effects duringthe period attributable to each of thefollo(ing0

!a" expected return on plan assets?!b" actuarial gains and losses?

!c" foreign currency exchange rate

changes on plans measured in a currency

different from the enterprise@s reportingcurrency?!d" contributions by the employer?

!e" ontributions by the plan participants?

!f" benefits paid?

!g" amalgamations?

!h" settlements?

!ii" a reconciliation of the present alue of the defined benefit obligation in !i" aboeand the fair alue of the plan assets in !i"aboe to the assets and liabilities recognisedin the 4alance -heet sho(ing at least0

!a" the past serice cost not yet recognisedin the 4alance -heet !see para & of A- $!reised 2%%$"?

2%


21/28



Yes N

o

Qualify? Sch

no :

Ref

!b" any amount not recogniHed as an asset because of the limit in para $!b" of A- 1$!reised 2%%$"?!c" the fair alue at the 4alance -heet dateof any reimbursement right recognised asan asset in accordance (ith para 1%3 of A-1$ !reised 2%%$" !(ith a brief descriptionof the link bet(een the reimbursementright and the related obligation"?

!d" the other amounts recognised in the4alance -heet?iii" the total expense recognised in therofit and 6oss Account of each of thefollo(ing, and the line item!s" of the rofit

and 6oss Account in (hich they areincluded0

!a" current serice cost?

!b" interest cost?

!c" expected return on plan assets?

!d" expected return on any reimbursementright recognised as an asset under paragraph 1%3 of A- 1$ !reised 2%%$"?!e" actuarial gains and losses?

!f" past serice cost?

!g" the effect of any curtailment or

settlement?!h" the effect of the limit in paragraph$!b" of A- 1$ !reised 2%%$", i.e., theextent to (hich the amount determinedunder para $$ of A- 1$ !reised 2%%$" !if negatie" exceeds the amount determinedunder para $ !b" of A- 1$ !reised 2%%$"?

!ix" for each maGor category of plan assets,(hich should include, but is not limited to,equity instruments, debt instruments, property, and all other assets, the percentageor amount that each maGor category

constitutes of the fair alue of the total planassets?!x" the amounts included in the fair alue of the plan assets for0

!a" each category of the enterprise@s o(nfinancial instruments?!b" !i" any property occupied by the

enterprise?

21


22/28



Yes N

o

Qualify? Sch

no :

Ref

!ii" other assets used by the enterprise?!xi" a narratie description of the basis usedto determine the oerall expected rate of return on assets, including the effect of themaGor categories of plan assets?!xii" the actual return on0

a" plan assets?

b" any reimbursement right recognisedas an asset in accordance (ith para1%3 of A- 1$ !reised 2%%$"?

!xiii" the principal actuarial assumptionsused as at the 4alance -heet date, including,(here applicable0

!a" the discount rates?

!b" the expected rates of return on any planassets for the periods presented in thefinancial statements?!c" the expected rates of return for the periods presented in the financialstatements on any reimbursement rightrecognised as an asset under para 1%3 of A- 1$ !reised 2%%$"?!d" medical cost trend rates?

!e" any other material actuarialassumptions used?!f" an assertion under the actuarialassumptions to the effect that estimates of future salary increases, considered inactuarial aluation, take account of inflation, seniority, promotion and other releant factors such as supply anddemand in the employment market?

!xi" keeping all other assumptions constant,the effect of an increase of one percentage point and the effect of a decrease of one percentage point in the assumed medicalcost trend rates on0

!a" the aggregate of the current serice

cost and interest cost components of net periodic post'employment medical costs?!b" the accumulated post'employment benefit obligation for medical costs?

Note: /or item &%iv' above, for plansoperating in a high inflation environment, thedisclosure should be the effect of a percentage increase or decrease in the

22


23/28



Yes N

o

Qualify? Sch

no :

Ref

assumed medical cost trend rate of a significance similar to one percentage point in a low inflation environment.

!x" the amounts for the current annual period of0!a" !i" the present alue of the defined benefitobligation?

!ii" fair alue of plan assets? !iii" the surplus or deficit in a plan?!b" the experience adGustments arising on0!i" the plan liabilities expressed either as anamount or as a percentage of the plan

liabilities at the 4alance -heet date? and!ii" the plan assets expressed either as anamount or as a percentage of the plan assets

at the 4alance -heet date?!c" the employer@s best estimate, as soon as it

can reasonably be determined, of

contributions expected to be paid to the planduring the annual period beginning after the

4alance -heet date?hether the enterprise has disclosed eachactuarial assumption in absolute terms !for example, as an absolute percentage" and not Gust as a margin bet(een different percentage or other ariables?

here an enterprise has more than onedefined benefit plan, (hether disclosureshae been made in total 0!i" separately for each plan? or!ii" in such grouping as are considered to bemost useful?hen an enterprise proides disclosures intotal for a grouping of plans, (hether disclosures are proided in the form of'!i" (eighted aerage? or!ii" of relatiely narro( ranges?here required by A- 1+, @#elated artyisclosures@, (hether the enterprise hasdisclosed information about0 '!i" related party transactions (ith post'employment benefit plans? and!ii" post'employment benefits for keymanagement personnel?hen required by A- 2, @roisions,ontingent 6iabilities and ontingent

23


24/28



Yes N

o

Qualify? Sch

no :

Ref

Assets@, (hether the enterprise disclosesinformation about contingent liabilitiesarising from post'employment benefitobligations?

06 OTHE3 LON TE3M EMPLOYEEBENEFITS

06.1 Ba#!* &" &+% understanding of the payroll business cycle &f t! !"t!%p%i#!) t! %!'i!$&f employees hand book, >.#. policies)Mi"+t!# &f t! C&(p!"#ati&" C&((itt!!)if a"y) %!'i!$ &f t! p%i&% y!a% $&%4i",pap!%#) t! l!,al #tat+t!# applicabl! !tc.)a#c!%tai" $!t!% a"y &f t! f&ll&$i",!(pl&y!! b!"!fit# a'! b!!" p%&'i*!*

!a" long'term compensated absences such aslong'serice or sabbatical leae9

!b" Gubilee or other long'serice benefits9

!c" long'term disability benefits9

!d" profit'sharing and bonuses payabl!

t$!l'! (&"t# &% (&%! aft!% t! !"* &f t!

p!%i&* in (hich the employees render the

related serice9 and!e" deferred compensation paid t(ele

months or more after the end of the period in

(hich it is earned.

06.0 If the ans(er to any of the items coered by para 2&.1 aboe is in the affi%(ati'!) thensuch employee benefits need to be classifiedas L&", T!%( E(pl&y!! B!"!fit#.

06.2 3!c&,"iti&" a"* M!a#+%!(!"t

nsure that the amount recognised as a

liability for other long'term employee

benefits is the "!t t&tal of the follo(ingamounts0

!a" the p%!#!"t 'al+! &f t! *!fi"!* b!"!fit

&bli,ati&" at the 4alance -heet date9

!b" minus the fai% 'al+! at the 4alance -heetdate &f pla" a##!t# !if any" out of (hich the

obligations are to be settled directly.

M!a#+%!(!"t of the liability should be on

the #a(! ba#i# a# 8!fi"!* B!"!fit Pla"# as

stated in para to 1$ aboe.

#ecognition and measurement of anyreimbursement right should be in accordance

2&


25/28



Yes N

o

Qualify? Sch

no :

Ref

(ith para 1 aboe.06.6 nsure that the "!t t&tal of the follo(ing

amounts is recognised as an !/p!"#! &%i"c&(!) except to the extent that another

Accounting -tandard requires or permits their

inclusion in the cost of an asset0!a" current serice cost9

!b" interest cost 9

!c" the expected return on any plan assets and

on any reimbursement right recognised as anasset9

!d" actuarial gains and losses, (hich should

all be recognised immediately9!e" past serice cost, (hich should all be

recognised immediately9 and!f" the effect of any curtailments or settlements.

06.5 8i#cl+%!#/his -tatement does not require specificdisclosures about long term employee benefits. >o(eer, (here other accountingstandards require specific disclosures aboutother long term employee benefits, (hether such disclosures hae been made?!e.g., A- $ , @et rofit or 6oss for the eriod,rior eriod Items and hanges in Accounting

olicies@, A- 1+, @#elated arty isclosures@".05 TE3MINATION BENEFITS

05.1 • nsure that the enterprise %!c&,"i#!#

termination benefits as a liability and

an !/p!"#! &"ly $!"0

a. a p%!#!"t &bli,ati&" arises asa result of a past eent9

b. there is a probability that an

&+tfl&$ &f %!#&+%c!# (ill berequired to settle the

obligation9 and

c. the a(&+"t of the obligationcan be %!liably !#ti(at!*.

• nsure that the termination benefits

are %!c&,"i#!* i((!*iat!ly as an

!/p!"#!.

• If the termination benefits fall *+!

(&%! ta" 10 (&"t# aft!% the

2$


26/28



Yes N

o

Qualify? Sch

no :

Ref

balance sheet date, ensure that theyhae been *i#c&+"t!* using the

discount rate specified in para 1&

aboe.05.0 8i#cl+%!#

!i" here there is uncertainty about thenumber of employees (ho (ill accept anoffer of termination benefit, (hether theenterprise has disclosed information aboutthe contingent liability unless the possibilityof outflo( in settlement is remote? !A- 2,@roisions, ontingent 6iabilities andontingent Assets@"!ii" here termination benefit is of such

siHe, nature or incidence that its disclosure isreleant to explain the performance of theenterprise for the period, (hether termination benefits hae been disclosedappropriately?!A- $, @et rofit or 6oss for the eriod,rior eriod Items and hanges inAccounting olicies@"?!iii" here required by A- 1+, @#elated artyisclosures@, (hether the enterprise hasdisclosed information about termination

benefits for key management personnel?07 T3ANSITIONAL [email protected] E(pl&y!! B!"!fit# &t!% ta" 8!fi"!*

B!"!fit Pla"# a"* T!%(i"ati&" B!"!fit#:nsure that the *iff!%!"c! !as adGusted byany related tax expense" bet(een theliability, existing on the date of adopting this-tandard and the liability that (ould hae been recognised at the same date, as per the pre'reised A- 1$, has been a*+#t!*against &p!"i", bala"c! &f %!'!"+!%!#!%'!# a"* #+%pl+#.

07.0.1 8!fi"!* B!"!fit Pla"#nsure that the enterprise has determined the

liability &" t! *at! &f fi%#t a*&pti", this

-tandard as under0!a" the p%!#!"t 'al+! &f t! &bli,ati&" at the

*at! &f a*&pti&"9

!b" minus the fai% 'al+!, at the *at! &f

a*&pti&", &f pla" a##!t# !if any" out of

2)


27/28



Yes N

o

Qualify? Sch

no :

Ref

(hich the obligations are to be settleddirectly9

!c" minus any pa#t #!%'ic! ct that should

be recognised in later periods.07.0.0 If the t%a"#iti&"al liability i# (&%! than the

liability that (ould hae been recognised atthe same date as per the pre'reised A- 1$,

the enterprise can make an i%%!'&cabl!c&ic! t& %!c&,"i#! that i"c%!a#! as part of

its defined benefit liability0!a" i((!*iat!ly as an adGustment a,ai"#t t!&p!"i", bala"c! &f %!'!"+! %!#!%'!#

a"* #+%pl+# !as adGusted by any related taxexpense", or

!b" as an !/p!"#! &" a #t%ai,t-li"! ba#i#oer +p t& fi'! y!a%# from the date of adoption.

07.0.2 If an enterprise chooses option !b" aboe,ensure that the enterprise has0

!i" appli!* t! li(it *!#c%ib!* i" pa%a.2.29b aboe in measuring any asset

recognised in the 4alance -heet9!ii" *i#cl!* at each 4alance -heet date0

!1" the amount of the i"c%!a#! tat %!(ai"#

+"%!c&,"i#!*9 and!2" the a(&+"t %!c&,"i#!* in the current

period9

!iii" li(it!* t! %!c&,"iti&" &f #+b#!=+!"t

act+a%ial ,ai"# only to the extent that the

net cumulatie unrecognised actuarial gains

exceed the unrecognised part of the

transitional liability9 and!i" i"cl+*!* the related part of the

+"%!c&,"i#!* t%a"#iti&"al liability in

*!t!%(i"i", any #+b#!=+!"t ,ai" &% l# &"

#!ttl!(!"t &% c+%tail(!"t.07.0.6 If the t%a"#iti&"al liability i# l!## than the

liability that (ould hae been recognised at

the same date as per the pre'reised A- 1$,

the enterprise should %!c&,"i#! the *!c%!a#!

i((!*iat!ly as an adGustment a,ai"#t t!

&p!"i", bala"c! &f %!'!"+! %!#!%'!# a"*

#+%pl+#.

2*


28/28



Yes N

o

Qualify? Sch

no :

Ref

07.2 T!%(i"ati&" B!"!fit#

here an enterprise incurs expenditure on

termination benefits on or before 31st

accounting standard 15 revised

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