Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Doubt related to Non-accumulating paid absences expense
- This topic has 3 replies, 2 voices, and was last updated 4 years ago by Stephen Widberg.
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- June 24, 2020 at 6:02 pm #574634
Extract from BPP Workbook –
“Non-accumulating paid absences
Non-accumulating absences cannot be carried forward (eg maternity leave or military service).Therefore they are only recognised as an expense when the absence occurs (IAS 19: para.11).”How is there going to be an *another expense* *when the absence occurs*?
For example-
“A” Employee is allowed to take 6 leaves per year.. and is paid 12000 dollars a year.So he would still be paid 12000 dollars whether he takes those 6 leaves or not. At the end of month the only expense would be (Salary expense=Debit – Cash=Credit) whether he takes those 6 leaves or not.
then which another expense is recognised when the absence occurs?
June 25, 2020 at 1:26 pm #574667I don’t think there is another expense.
If my employee takes maternity in 2021, I will have to continue to pay her (if required by law) – and I will book that cost in 2021.
June 27, 2020 at 4:04 pm #574817Extract from Kaplan Study text–
for non-accumulating benefits, an expense should only be recognised when the absence occurs. This may arise, for example, where an employee continues to receive their normal remuneration whilst being absent due to illness or other permitted reason. A charge to profit or loss would be made only when the authorised absence occurs; if there is no such absence, there will be no charge to profit or loss.
What would be the Journal entry if a person is absent due to illness under Non-accumulating paid absences?
June 28, 2020 at 3:51 pm #574870If you pay them
Dr Payroll expense Cr Cash
If you don’t pay them
Nothing
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