IAS 19 — Treatment of employee contributions

Date recorded:

The IFRIC considered a request to clarify the treatment of employee contributions in cost-sharing pension plans. The accounting issues raised in the submission were whether:

  • the service cost should reflect the cost-sharing nature of the arrangement;
  • any surplus that must be used to adjust members' benefits or required contributions should be treated as an addition to the liability;
  • any additional contributions that are expected to be required from members to finance a deficit should be treated as a deduction from the liability

The IFRIC agreed with the staff analysis that there was sufficient guidance in IAS 19 Employee Benefits to answer the issues. The staff was asked to adapt its analysis for inclusion in the tentative agenda decision.

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