Interest-free and concessional staff loans create an employee benefit that often goes unrecognised, because the loan sits on the boundary between two standards. This post sets out the employee loan accounting treatment under IAS 19 and IFRS 9, with a worked example showing the profit and loss impact each year.
Employers sometimes pay advances to employees against their future EOSB entitlement. The accounting treatment—settlement vs. receivable—depends on documentation and recovery rights. This guide provides a decision framework for finance teams and auditors.
IFRS 9 requires companies to recognise expected credit losses on trade receivables from day one. This guide explains how to build a provision matrix – the most common method for calculating ECL on trade receivables under the simplified approach.
The Saudi Arabia discount rate for December 2025 ranges from 4.04% (6 months) to 6.21% (30 years), with a 217 bps term premium. Strong trading volume of SAR 36.8 million and 78.5% smoothing alpha indicate high curve reliability. Applicable to IAS 19 employee benefits, IFRS 17 insurance contracts, and IFRS 9 ECL calculations.
The discount rate is one of the most significant assumptions in IAS 19 valuations. For Saudi EOSB, using USD Treasury yields or other GCC curves violates the standard’s currency consistency requirement. Learn why SAR-denominated government bonds are the only correct source.
Last Updated Data Source Saudi Exchange Method Nelson-Siegel Methodology Data Collection: Taken from Saudi Exchange (Tadawul) government bond and sukuk transactions at 5:00 PM KSA. Data Filtering: Only confirmed trades are considered for bootstrapping and curve-fitting. Historical Aggregation: When fewer than 3 bonds trade on a given day, we aggregate trades from up to 7 […]
Saudi EOSB schemes have a back-loaded benefit structure that triggers IAS 19’s straight-line attribution requirement under paragraphs 70-73. This post walks through the compliance implications with worked examples for actuaries and finance professionals.
Introduction End of Service Benefits (EOSB) are a key component of employee compensation, particularly in Saudi Arabia and other neighbouring countries. Under IAS 19 – Employee Benefits, EOSB schemes are typically classified as defined benefit plans, requiring companies to recognise their obligations using the Projected Unit Credit (PUC) method. However, in certain cases, IAS 19 […]
Impact of COVID-19 on actuarial valuation COVID-19 pandemic has had a devastating impact on most businesses. One of the areas where companies have been hit hard is the cost of employee benefit schemes. Actuarial liabilities (Defined Benefit Obligation, DBO) have increased significantly, driven by a fall in discount rates. Apart from the adverse impact on […]
The adoption and implementation of IFRS in the Kingdom of Saudi Arabia (KSA) is a major step towards increasing the transparency and comparability of the financial statements of the companies doing business in the Kingdom. We receive a lot of queries from such companies regarding the impact of this change and the need for actuarial […]