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CA Final Ind AS 19 Employee Benefits — practice questions

Explore 37 free Ind AS 19 Employee Benefits questions in CA Final Financialreporting. Open each question or exercise to read its content, reference answers and available explanation.

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Ind AS 19 Employee Benefits questions and exercises with answers

Showing questions 1–30 of 37.

Which method measures the present value of defined benefit obligations?Read the answer and worked solution →Where are remeasurements of net defined benefit liability recognised?Read the answer and worked solution →What later happens to remeasurements recognised in OCI?Read the answer and worked solution →The IAS 19 discount rate refers to market yields on which instruments?Read the answer and worked solution →When must past service cost be recognised as an expense?Read the answer and worked solution →When are short-term employee benefits expensed?Read the answer and worked solution →Employees earn wages of 50,000 for December and 45,000 is paid by 31 December. What liability remains?Read the answer and worked solution →Current service cost of a defined benefit plan is recognised where?Read the answer and worked solution →Service cost is 10,000 and cash contributed to plan assets is 8,000. What is the P&L charge?Read the answer and worked solution →A lower discount rate raises the obligation by 2,000. How is it treated?Read the answer and worked solution →How is net interest on the net defined benefit liability calculated?Read the answer and worked solution →The net defined benefit liability is 400,000 and the discount rate is 8 percent. What is the net interest?Read the answer and worked solution →Employee benefits cover all consideration given in exchange for what?Read the answer and worked solution →Which pair is an example of post-employment benefits?Read the answer and worked solution →When must an entity recognise a liability for employee benefits?Read the answer and worked solution →What decides if a post-employment plan is defined benefit or contribution?Read the answer and worked solution →In a defined benefit plan, on whom does actuarial risk rest?Read the answer and worked solution →Which variables often drive pension calculation in a defined benefit plan?Read the answer and worked solution →Many defined benefit plans are funded through contributions to what?Read the answer and worked solution →Defined benefit disclosures must explain plan characteristics and what else?Read the answer and worked solution →Which formula is most common in a traditional defined benefit plan?Read the answer and worked solution →A plan pays 100 a month per year of service. What monthly pension does a retiree with 30 years get?Read the answer and worked solution →Pension is years times final salary times 1/80. Find it for 30 years and 80,000 salary.Read the answer and worked solution →Why is early retirement pay often reduced in a defined benefit plan?Read the answer and worked solution →What does a life annuity pay to a retiree?Read the answer and worked solution →Which factor do actuaries consider when setting defined benefit contributions?Read the answer and worked solution →In a defined contribution plan, who assumes investment risk and rewards?Read the answer and worked solution →Why is the sponsor's liability easy to determine in a defined contribution plan?Read the answer and worked solution →In a defined contribution plan, what is known in advance?Read the answer and worked solution →Indian Central Government staff joining after 1 January 2004 are in which plan?Read the answer and worked solution →

Worked practice questions

Which method measures the present value of defined benefit obligations?

  1. Net realisable value
  2. Straight-line method
  3. Reducing balance
  4. Projected Unit Credit
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Correct answer: D. Projected Unit Credit

The standard requires the Projected Unit Credit Method because each period of service is seen as building up an extra unit of benefit entitlement.

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Where are remeasurements of net defined benefit liability recognised?

  1. Statement of profit
  2. Share capital A/c
  3. Other comp. income
  4. Securities premium
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Correct answer: C. Other comp. income

Actuarial gains and losses and other remeasurements go straight to OCI instead of the statement of profit and loss.

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What later happens to remeasurements recognised in OCI?

  1. Amortised to profit or loss
  2. Recycled at settlement
  3. Never reclassified to profit
  4. Written off on sale
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Correct answer: C. Never reclassified to profit

Remeasurements in OCI stay there permanently and are never recycled to profit or loss, although the entity may transfer them within equity.

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More Financialreporting topics

Ind AS 116 LeasesInd AS 36 Impairment of Assets and Ind AS 38 Intangible AssetsInd AS 24 Related Party Disclosures and Ind AS 108 Operating SegmentsInd AS 1 Presentation of Financial StatementsInd AS 12 Income TaxesInd AS 113 Fair Value MeasurementInd AS 109 Financial InstrumentsInd AS 23 Borrowing Costs and Ind AS 40 Investment Property