The Malaysian Accounting Standards Board (MASB) has issued amendments to MFRS 2 Share-based Payment with regards to classification and measurement of share-based payment transactions.
The amendments is word-for-word the amendments to IFRS 2 issued by the International Accounting Standards Board (IASB).
The amendments provides specific guidance on how to account for the following situations:
(a) the effects of vesting and non-vesting conditions on the measurement of cash-settled share-based payments;
(b) share-based payment transactions with a net settlement feature for withholding tax obligations; and
(c) a modification to the terms and conditions of a share-based payment that changes the classification of the transaction from cash-settled to equity-settled.
“Currently, there is no specific requirement that deals with the accounting of the above situations," says MASB Chairman Encik Mohamed Raslan. "With the amendments, companies would now have better clarity on how to account for such situations.”
The amendments shall be applied to financial statements of annual periods beginning on or after 1 January 2018. Earlier application is permitted.
Similar amendments are also made to FRS 2 Share-based Payment.