Ind AS 102: Share-based Payment#
Scope#
Applies to share-based payment transactions where entities:
- Grant shares, stock options, or equity instruments to employees
- Settle transactions in cash or other assets based on share price
Types of Share-based Payment#
1. Equity-settled Transactions
- Shares or options granted to employees
- Measurement at fair value of equity instruments
- Vesting period recognition
2. Cash-settled Transactions
- Liability based on fair value of shares
- Remeasurement at each reporting date
- Settlement in cash
3. Transactions with Choice
- Employee can choose settlement method
- Account for as equity-settled unless liability exists
Recognition & Measurement#
Grant Date#
- Fair value of equity instruments determined
- Not subsequently adjusted for market conditions
Vesting Period#
- Expense recognized over vesting period
- Reversed if vesting conditions not met
Fair Value Calculation#
| Method | Use Case |
|---|---|
| Black-Scholes | Plain vanilla options |
| Binomial Model | American options |
| Monte Carlo | Complex vesting conditions |
Disclosure Requirements#
- Description of each share-based payment plan
- Number and weighted average exercise price
- Fair value of options granted
- Expense recognized in the period
- Maturity analysis of options
Key Differences from Previous GAAP#
| Aspect | Previous GAAP | Ind AS 102 |
|---|---|---|
| Measurement | Intrinsic value | Fair value |
| Expense timing | Vesting date | Over vesting period |
| Reversal | Not allowed | Allowed for lapses |