IFRS 2 Vesting Conditions and Cancellations
The Board discussed several proposed amendments to the second pre-ballot draft of the ED. (The pre-ballot draft was omitted from the observer notes.)
In general the Board decided not to address any divergence issues in relation to SFAS 123 (revised) within the scope of this project since such issues should be addressed within the liability and equity project.
Without detailed discussion the Board agreed to the following changes to the second pre-ballot draft of the ED:
- Change paragraph 26 to clarify that a cancellation cannot occur before the grant date.
- In Implementation Guidance [a new IG (IG24) is being prepared] to confirm that the required treatment of a true cancellation by the counterparty or the entity only applies if the cancellation occurs after the grant date, that is, that the entity would revise earlier estimates to reflect the grant date value of zero in case of 'cancellations' before the grant date.
- Add a sentence to the Basis for Conclusions to clarify that 'a share-based payment may vest even if some non-vesting conditions have not been met'.
- Not to include a flowchart illustrating vesting conditions in paragraph IG 4A [new] (the flowchart was included in the Observer Note).