CORPORATE REPORTING THEORY & PRACTICE

Corporate Reporting Theory & Practice

Corporate Reporting Theory & Practice

Introduction

The International Accounting Standard Board (IASB) has offered and published exposure draft of recommended changes to IAS 19 Employee Benefits. The purpose of these proposed changes is to improve the accounting for employee benefits. The part of its project is to compensate and provide relaxation to the employee in terms of benefits which can relief the worker in many aspects. This paper discusses these proposed amendments along with the presentation and recognition of benefits. The defined impacts of these changes are also elaborated in response to the financial statement of the group company.

Discussion

There are many propositions in exposure draft which affects the three main categories including recognition and measurement of defined benefit cost (i.e. service cost, finance cost, and re-measurements) (ii) recognition and presentation of defined benefit liabilities and assets, and (iii) disclosures for defined benefit plans. All the suggestions by investors are dependent upon the viewpoints of experts who are included in the concerns of the drafts. The reason for these progressions is defined in light of different improvisations, for example decrease in intricacy which empowers the profit of workers. The recognition and measurement of defined costs can definitely benefit the employees and prove to be a remarkable improvement the accounting methods. The types of costs such as finance cost, service cost, and other related costs rely on these aspects for successful estimation. Therefore, the problems arise if the concerned area is not catered as per standards (Board, 2005).

The recognition and presentation of defined benefit assets and liabilities should be clear to employees. Any sort of deception in this concern might consequently result in problems. Therefore, the evaluation of the proposed changes in exposure draft is thoroughly reviewed and open for the comments of investors and analysts. The policies itself have to experience the certain amount of retaliation which leads to improvements. Thus, it is regarded as an important aspect as well. Similarly, the defined benefit plans should be disclosed for better understanding. The issues leading to deception should be eliminated to ensure the maximum confidence in the mutual consideration.

The exposure draft intends to propose necessary changes to improve the accounting of employee benefits. The company aims to provide the various advantages to its workers which are further revamped into progression by this draft. The evaluation of this draft explains the changes with respect to complexity and complication reduction, improvement in consistency and transparency in practices. All these implications are based on the perspectives of investors and analysts who are involved in the concerns of the drafts. The purpose of these changes is defined in light of various improvisations such as reduction in complexity which enables the benefit of employees.

Another consideration based on the evaluation of this draft is the improvement in consistency. This allows the employees inclination towards the edge of constant progress and development which consequently results in the establishment of standards. These standards lead to progress of the overall principles of ...