Sebastian Ltd grants its manager a share option plan conditional on the manager contributing 10% of his
Question:
Sebastian Ltd grants its manager a share option plan conditional on the manager contributing 10% of his fortnightly salary of \($3000\) for the next 2 years. The fortnightly payments will be automatically deducted from the manager’s salary and held until either: the end of the two-year period when the manager exercises their right to the share options; or earlier, within the two-year period, if the manager chooses to opt out of this arrangement and be refunded their contributions. Sebastian Ltd estimates the annual expense for this share-based payment plan to be $2000.
Required
Discuss the requirements of AASB 2/IFRS 2 if the manager chooses to discontinue his contributions and opts out of this share option plan after 12 months.
Step by Step Answer:
Financial Reporting
ISBN: 9780730396413
4th Edition
Authors: Janice Loftus, Ken Leo, Sorin Daniliuc, Belinda Luke, Hong Nee Ang, Mike Bradbury, Dean Hanlon, Noel Boys, Karyn Byrnes