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.
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.
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.
When reviewing an actuarial valuation, one of the most closely examined figures is the movement in actuarial gains and losses. These movements, known as remeasurements under IAS 19, can vary significantly from one year to the next and may have a noticeable impact on a company’s financial position. For organisations with long-term employee benefit schemes, […]
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 […]
Actuarial valuation and reporting of a pension scheme under IAS 19 is significantly more complex than other employee benefit plans. Several issues, which after often ignored, need to be understood and allowed for when reporting for pension schemes.
Setting the discount rate for actuarial valuation correctly is often not very well understood by the reporting companies. This post summarizes some of the most common questions our clients and their auditors ask about choosing the right discount rate. For a complete overview about setting the discount rate, please refer to this post. 1) What is the […]