Narrow-scope amendments to IAS 19 and IFRIC 14 — Remeasurement on a plan amendment, curtailment or settlement / Availability of a refund of a surplus from a defined benefit plan [Completed]
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Effective date and transitional provisions: |
An entity applies the amendments to IAS 19 to plan amendments, curtailments or settlements occurring on or after the beginning of the first annual reporting period that begins on or after January 1, 2019. Early application is permitted but must be disclosed. With respect to IFRIC 14, the IASB concluded that it would discontinue its project to amend this standard at its meeting on February 21-24, 2022. |
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Last updated: |
February 2022 |
Reach out to our IAS 19 Specialist |
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Overview
This project combines two issues into a single package of narrow-scope amendments to IAS 19, Employee Benefits and IFRIC 14, The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction. It aims to clarify:
- the calculation of current service cost and net interest when an entity remeasures the net defined benefit liability (asset) when a plan amendment, curtailment or settlement occurs; and
- whether a trustee's power to augment benefits or to wind up a plan affects the employer's unconditional right to a refund and thus, in accordance with IFRIC 14, restricts recognition of an asset.
Both issues were orginally submitted separately to the IFRS Interpretations Committee, however, the IASB decided to deal with them in one narrow-scope project as both issues relate to IAS 19. The IASB believes that a single package of amendments carried out at the same time would reduce the administrative burden on those responding to both issues.
However, in April 2017 the IASB decided to pursue the amendments to IAS 19 and in September 2017 confirmed it would do so despite putting off the amendments to IFRIC 14. Although exposed together, the IAS 19 amendments are unrelated to the IFRIC 14 amendments.
The amendments in Plan Amendment, Curtailment or Settlement (Amendments to IAS 19) are:
- If a plan amendment, curtailment or settlement occurs, it is now mandatory that the current service cost and the net interest for the period after the remeasurement are determined using the assumptions used for the remeasurement.
- In addition, amendments have been included to clarify the effect of a plan amendment, curtailment or settlement on the requirements regarding the asset ceiling.
At its meeting on February 21-24, 2022, the IASB noted that it has done research to help it decide whether to develop a more principle-based approach than is currently in IFRIC 14 for an entity to assess and measure its right to a refund of a surplus. The IASB reviewed the project’s prospects for progress and concluded that these prospects are limited. Therefore, the IASB decided to withdraw the project from its work plan.
Other developments
December 2021
On December 17, 2021, the IASB staff updated the work plan to indicate that the Board will decide the project direction with respect to the amendments to IFRIC 14 in February 2022.
February 2020
On February 28, 2020, the IASB staff updated the work plan to indicate that the Board will decide the project direction with respect to the amendments to IFRIC 14 (no date specified).
February 2018
On February 7, 2018, the IASB published Plan Amendment, Curtailment or Settlement (Amendments to IAS 19), thus finalizing one of two issues relating to IAS 19, submitted to the IFRS Interpretations Committee and exposed together in June 2015.
January 2018
On January 26, 2018, the IASB Staff updated this project to indicate that the IASB now expects to issue the final amendments to IAS 19 in February 2018. The latest IASB Work Plan is silent about the date when the final amendments to IFRIC 14 will be issued.
October 2017
On October 27, 2017, the IASB Staff updated this project to indicate that the IASB expects to issue the final amendments to IAS 19 in January 2018.
September 2017
On September 22, 2017, the IASB staff updated the work plan to indicate that the IASB expects to the final amendments to IAS 19 in December 2017 and the final amendments to IFRIC 14 in the first half of 2018.
July 2017
On July 21, 2017, the staff of the IASB updated the work plan to indicate that the IASB expects to issue the final amendments to IAS 19 and IFRIC 14 in the first half of 2018.
June 2017
In June 2017, the IASB staff updated the work plan to indicate that the IASB expects to issue the final amendments to IAS 19 and IFRIC 14 in Q4/2017.
April 2017
On April 28, 2017, the IASB staff issued an updated Work Plan which indicates that the IASB expects to issue the final IFRS amendments to IAS 19 and IFRIC 14 before October 2017.
March 2017
On March 23, 2017, the IASB staff issued an updated Work Plan which indicates that the IASB expects to publish the final amendments to IAS 19 and IFRIC 14 after September 2017.
December 2016
On December 15, 2016, the IASB staff updated the Work Plan in respect of this project to indicate that the IASB expects to publish the final amendments to IAS 19 and IFRIC 14 after June 2017.
September 2016
On September 23, 2016, the IASB staff updated the Work Plan in respect of this project to indicate that the IASB expects to decide the project direction by December 31, 2016.
June 2016
In June 2016, the IASB staff updated the Work Plan to indicate that the direction of this project will be decided in Q3/2016.
July 2015
On July 28, 2015, the AcSB issued an Exposure Draft that corresponds to the IASB's Exposure Draft on this topic. The AcSB proposes to incorporate into Part I of the CPA Canada Handbook – Accounting amendments to IAS 19, Employee Benefits and IFRIC 14, IAS 19 — The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction. The proposed amendments are designed to improve information to investors and address some diversity in practice. The deadline for responding to the Exposure Draft is October 19, 2015.
June 2015
On June 19, 2015, the IASB released ED/2015/5 Remeasurement on a Plan Amendment, Curtailment or Settlement/Availability of a Refund from a Defined Benefit Plan (Proposed amendments to IAS 19 and IFRIC 14). Comments are requested by October 19, 2015.
January 2015
The IASB added this project to its Work Plan in January 2015.
