Applicability of actuarial valuation on leave schemes

is actuarial valuation mandatory for leave encashment

Companies often ask us if an actuarial valuation mandatory for leave schemes. It is clear that accounting and audit professionals require some additional guidance on this matter. In this post, we aim at addressing this issue. The short answer is, an actuarial valuation will be applicable if your company offers leave benefits that would require […]

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ESOP and SAR: Ind AS 102 perspective

ESOP SAR Ind AS 102

With the rise in start-ups in India, we are observing an increasing trend in share-based remuneration schemes to the employees, the most popular ones being ESOP and SAR. However, we have observed a gap amongst professionals and company personnel, in the knowledge of the different types of schemes and their accounting treatment. As such, in this […]

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Applicability of actuarial valuation on gratuity scheme

applicability of actuarial valuation

All kinds of businesses, in whatever form and size, have expressed a desire to understand the regulatory framework under which actuarial valuations are performed. This is especially true for the most common benefit in India – the gratuity scheme. This blog explains the applicability of actuarial valuation of gratuity under different instances. But before diving into the […]

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Superannuation fund taxation from employer’s perspective

Employee benefit

Before we start with taxation on superannuation fund, let us understand what exactly is a superannuation fund. Makes sense, so what is superannuation fund ? Cambridge dictionary defines “superannuation” as “money that people pay while they are working, so that they will receive payment when they stop working when they are old, or the payment they receive when they stop working” So, in simple words, superannuation funds refer to the […]

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5 issues to consider for funding a gratuity scheme

Issues to consider for funding a gratuity scheme

Under the right circumstances, a decision for funding a gratuity scheme could deliver significant benefits to the companies. Gratuity is a statutory benefit – employers are required to pay a lumpsum benefit to their employees who have served for at least five years. The lumpsum is generally calculated as 15 days of eligible salary for […]

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4 issues about actuarial valuation of leave schemes

actuarial valuation of leave schemes

Treatment of leave schemes under AS 15 and Ind AS 19 is widely misunderstood. Companies end up spending resources on actuarial valuation of leave schemes that may not require any, while fail to identify schemes that may require one. Background Companies run several types of leave benefit schemes for their employees. Privilege leaves (also known as earned or […]

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Duration of liability for setting the discount rate for actuarial valuation

duration of liability for selecting discount rate for actuarial valuation

We are often asked questions about what is the “duration of liability” and how it impacts the discount rate use in the actuarial valuation of gratuity and leave encashment. We try to cover a few of these questions in this article. What is duration of liability? Duration of liability can be defined in more than […]

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4 ways in which Ind AS 102 can affect your company

4 ways in which Ind AS 102 can affect your company

Ind AS 102 will bring much needed uniformity in valuation and accounting of share-based benefits. However, the cost for the affected companies is likely to increase significantly. What Ind AS 102 is all about? Ind AS 102 prescribes financial reporting in respect of share-based benefits and is relevant for companies which remunerate their employees by share-based (or stock option) […]

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6 reasons why your pension reporting under IAS 19 may not be correct

IAS 19 - why your pension reporting may not be correct

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.

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Discount rate for actuarial valuation as at 31 March 2018

Discount rate for actuarial valuation 31 March 2018

It is the end of another financial year and time for companies to prepare their year-end financial statements for FY 2017-18. The discount rate for actuarial valuation as at 31 March 2018 is now known. This post explains the movement in the interest rate curves over the FY 2017-18 and how that is expected to […]

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