IPSAS Explained: A Summary of International Public Sector Accounting Standards, 2nd Edition

IPSAS 25: Employee Benefits

Objective

The objective of IPSAS 25 is to provide guidance for the accounting and disclosure of employee benefits. The standard requires an entity to recognize

a) A liability when an employee has provided service in exchange for employee benefits to be paid in the future

b) An expense when the entity consumes the economic benefits or service potential arising from service provided by an employee in exchange for employee benefits

The IFRS on which the IPSAS is based

IAS 19, Employee Benefits

Content

Principal definitions

Employee benefits are all forms of consideration given by an entity in exchange for service rendered by employees.

Short-term employee benefits are employee benefits (other than termination benefits and equity compensation benefits) which fall due wholly within 12 months after the end of the period in which the employees render the related service.

Postemployment benefits are employee benefits (other than termination benefits and equity compensation benefits) which are payable after the completion of employment.

Other long-term employee benefits are employee benefits (other than post-employment benefits and termination benefits) which do not fall due wholly within 12 months after the end of the period in which the employees render the related service.

Termination benefits are employee benefits payable as a result of either:

a) An entity's decision to terminate an employee's employment before the normal retirement date, or

b) An ...