Short-term employee benefits
Examples may include salaries, paid annual leave, bonuses and non-monetary benefits where the timing criterion is met. Recognise the undiscounted amount expected to be paid for service received as an expense, unless another standard requires inclusion in an asset, and as a liability after deducting amounts already paid. Do not classify a benefit merely by its name: assess when it is expected to be settled.
Worked example
Employees earn an annual bonus of $30,000 from services provided this year, payable in March after the year end. If the IAS 19 recognition conditions are satisfied, recognise a $30,000 expense and liability at year end.
Common mistake
Discounting a short-term benefit as though it were a long-term obligation or using the service date alone instead of expected settlement timing.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | FR | Supporting | September 2026–June 2027 |
| ACCA | SBR | Direct | September 2026–June 2027 |