IFRS 2 – Share-Based Payments: From Basics to Advanced

Explore how IFRS 2 measures equity settled share-based payments, distinguishing employees vs non-employees, using grant date fair value and the indirect method, with key treatment of equity reserves and vesting.

Explain grant date, vesting conditions, vesting period, vesting date, and exercise period, and distinguish service and performance, market and non-market conditions for IFRS 2.

Recognize equity-settled share-based payments by applying grant-date fair value, estimates of vesting (including market and non-market conditions), and the time factor, noting reversals for non-market but not market conditions.

Explore variable vesting period, variable number of equity instruments, and variable exercise price under IFRS 2 share-based payments, with market and non-market condition treatments and grant-date fair value locking.

Understand what happens after vesting under IFRS 2. Explore why vested options not exercised keep the share-based payment reserve in equity, and when expenses reverse.

When fair value cannot be reliably measured at grant date, IFRS 2 uses intrinsic value, remeasured at each reporting date and at settlement, with changes recognized in profit or loss.

Explain cash settled share-based payments, including phantom shares and share appreciation rights, where the company recognizes and remeasures a liability. Evaluate vesting conditions—service, market, and non-market—at each reporting date.

Explore settlement alternatives in IFRS 2, where a counterparty or company may choose between cash and equity settlement, creating a compound financial instrument and triggering split accounting.

Explains settlement alternatives under IFRS 2 for share-based payments where the counterparty may choose equity, options, or cash, detailing compound instruments, split accounting, and liability and equity components.

Assess whether the company has a present cash obligation when settlement is chosen, considering restrictions and past practice. Then apply cash or equity settlement accordingly, with no split accounting.

explains equity-settled trademark accounting under IFRS 2, initial recognition at the trademark's fair value, and impairment testing under is 38 for indefinite-lived intangibles.