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Sir, i have some doubts to clear on which figure to take when calculating the share based payment.
Why do we take fair value of share options instead of intrinsic value to calculate employee expenses since intrinsic value are the expenses paid by company to employees for their service, whereas fair value of share options included exercise price which is going to be paid by employees when they exercise their right.
The simple answer is “Because that’s what we are told to do by the IFRS”!
Intrinsic value is only considered when fair value is not determinable so only rarely will we resort to intrinsic value
Does that do it for you?
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