Post-employment benefits — Discount rate


This IASB project was to consider an amendments to paragraph 78 of IAS 19 Employee Benefits (1998) to remove the requirement to use a government bond rate when there is no deep market in high quality corporate bonds. Instead, the objective should be to estimate the rate for high quality corporate bonds in all cases.

The project arose because of the significant widening of the spread between yields on corporate bonds and yields on government bonds as a result of the global financial crisis.  The use of different rates under IAS 19 means that entities with similar employee benefit obligations can report them at very different amounts.


Current status of the project

The IASB discontinued this project. The IASB published an exposure draft in August 2009 but, on the basis of constituent feedback, decided against amending IAS 19 in favour of considering this issue as part of its comprehensive project on post-employee benefits.


Project milestones

July 2009 Added to the IASB's agenda
21 August 2009 Exposure draft ED/2009/10 Discount Rate for Employee Benefits (proposed amendments to IAS 19) published Comment deadline 30 September 2009
October 2009 IASB discontinued work on this project The issue will be included in the comprehensive post-employment benefits project.

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