Research project share-based payment

Date recorded:

IFRS 2 Share-based Payment research project- Report on research so far (Agenda Paper 16)

The IASB is currently conducting a research project on IFRS 2 to identify areas of complexity, its causes and application issues. The staff presented a summary of the research conducted so far.

The IASB will decide whether to move the project to development stage or discontinue the project following the results of the 2015 Agenda consultation.

The staff identified on its research activities that the complexity in IFRS derives from (i) the complexity of the arrangements and (ii) the usage of the grant date fair value measurement model for arrangements that are settled in shares or in share options. The staff also identified the following application issues (i) difficulty in understanding the core principle of the standard; (ii) perceived counterintuitive results in accounting for some transactions; (iii) complexity in classifying vesting and non-vesting conditions; and (iv) use of valuation assumptions which are not subsequently updated.

The staff also explored different approaches to move forward including (i) perform a post implementation review; (ii) perform further research on the grant date fair value measurement model; (iii) narrow scope amendments to IFRS or (iv) discontinue the project.

The staff does not present any recommendation on those topics.


The agenda paper was well received, with overall agreement that the paper staff had identified the right issues and their related implications.

The main comments focused on the issues identified and possible ways to move forward. There was agreement on the difficulties derived from the grant date fair value model. The issues discussed were for example (i) differences on treatment of some conditions when some were reflected at grant date while others were reflected at a future date; (ii) implications of the fact that the expense for past service would be recorded in the future even if that year was a bad year in terms of performance; and  (iii) the implications of having differences in the approaches to employee services received in IAS 19 and IFRS 2.

There was agreement that the work being undertaken in the conceptual framework and the liability-equity projects would provide an opportunity to align the definitions. There was also agreement that any review of IFRS 2 should involve stepping back to analyse the accounting model and that simplifying the existing model would be an appropriate objective.

No specific decisions were made during the discussion in terms of direction for the project, however; the Board agreed with the staff recommendation that it should wait for the results of the agenda consultation and that no further research was needed at the moment. 

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