Home › CA Final › financialreporting › Ind AS 102 — Share-based Payment: Scope, Grant Date, Vesting Conditions, Equity-settled vs Cash-settled › An entity issues shares for ₹1,000 each (current…
An entity issues shares for ₹1,000 each (current equity FV ₹1,000), payable in cash by employees. The cash payment is fixed in rupees, NOT linked to subsequent share price. Under Ind AS 102:
ACovered by Ind AS 102 because shares are issued
BNOT covered by Ind AS 102 — the amount paid is FIXED in cash (₹1,000), independent of future equity price movements; this is just a cash sale of shares
CCovered under Ind AS 19
DCovered only if employees receive a discount
Answer & Solution
Correct answer: B. NOT covered by Ind AS 102 — the amount paid is FIXED in cash (₹1,000), independent of future equity price movements; this is just a cash sale of shares
Ind AS 102 applies when payments are BASED ON the equity-instrument price. A fixed cash payment for shares (not based on subsequent value of the share or any equity-price-derivative) falls outside Ind AS 102 — it's a regular equity-issuance transaction.
Related questions
A vesting condition that requires the counterparty to complete a specified period of serviUnder Ind AS 102, transactions with parties OTHER THAN EMPLOYEES (e.g. service providers) Reload Feature/Reload Option under Ind AS 102 is BEST described as:An entity received goods/services for which it issued its own shares at a value DIFFERENT An entity issues its OWN shares to a CHARITY without any consideration. Under Ind AS 102:An entity grants share options conditional on (i) 4 years of continuous service AND (ii) sAn entity grants share options with EXERCISE PRICE conditional on a 30% increase in the shA 'MARKET CONDITION' under Ind AS 102 is one that relates to: