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In this question it states that it does not meet IFRS 2 because the contract may be settled net in cash.
Ifrs 2 is where an entity purchase goods and services to settle the payment in exchange of cash or share options. therefore I woukd think that if it can be settled bu cash it meets the ifrs 2 criteria?Karen contracts that may or will settled net in shares or cash based on shares are with in the scope of IFRS 9 FVTPL..net means profit or loss settlement….another hint is there is no intention and there is no past practice and it is not in normal course of business so it is outside the scope of IFRS 2
See when an entity enters Into a contract does that mean it will not fall under ifrs 2?
Here’s an extract from IASPLUS – the summary by Deloittes is necessarily brief and doesn’t go into the detail of the printed solution but here it is for what it’s worth
“Second, IFRS 2 does not address share-based payments within the scope of paragraphs 8-10 of IAS 32 Financial Instruments: Presentation, or paragraphs 5-7 of IAS 39 Financial Instruments: Recognition and Measurement. Therefore, IAS 32 and IAS 39 should be applied for commodity-based derivative contracts that may be settled in shares or rights to shares.”
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