alleryStart learning →If services cannot be valued reliably, the base is the
Afair value of instruments granted
Bcarrying value of net assets
Cnominal value of the shares
Dmarket value of the company
Answer & Solution
Correct answer: A. fair value of instruments granted
The standard moves to an indirect measure using the fair value of the equity instruments granted when the services cannot be valued directly.
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Related questions
2,000 SARs vest immediately with fair value Rs 35 each. Liability recognised at once isRs 200,000 was booked over 2 years, then a non-market profit target fails. Net cumulative 10 staff get 1,000 options each, FV Rs 25 with a 5-year share price target. Annual charge Total expected cost of a 4-year equity-settled plan is Rs 480,000 with no forfeitures. YeaSame SARs, year 2: 48 staff vest, fair value Rs 18, liability so far Rs 175,000. Year 2 ex50 staff hold 500 SARs each, 2-year vesting. SAR fair value is Rs 14 at end of year 1. YeaRepricing lifts fair value of 1,000 options from Rs 8 to Rs 11. Incremental fair value is1,000 vested options bought back at Rs 80 each when fair value is Rs 70. Expense recognise