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IAS 19Workpapers (Step 4 of 5)

Workpaper assignment

Step 4 of 5
Mission · workpaperWorkpaper · IAS 19L4 · Expert

Documents

Company profile and case conventions

Memo

Company profile and case conventions

Sorbane SA (fictitious entity) makes furniture; it closes its accounts on 31 December and its functional currency is the euro. Case conventions (pedagogical assumptions): amounts in EUR; all short-term benefits are settled within twelve months; for the managers plan, the benefits paid and the employer contribution occur on 31 December and net interest is computed at the start-of-year rate on the opening net liability; linear attribution of the benefit; the events of the workshop plan take effect on 1 July 20X6, the loss on the prior remeasurement and the net interest of the first half-year being already recognised in it; the rates, the flows and the horizon of the ceiling are data from the actuary; the tax effect is ignored.

Accrual of short-term employee benefits: salaries, accumulating absences, bonus or profit sharing and constructive obligation

Year-end employee benefits file: plan classification, short-term benefits, cost of a defined benefit plan, plan event and asset ceiling

9 documents9 sections to document
0 / 6 sections completed
Guided mode

Section 1 of 9

Objective

In progress
Section brief
What to document
The engagement, its scope and the working mode chosen.
Why
A workpaper answers one precise question: framing it avoids off-topic work.
How
Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
Expected result
You know which question the workpaper must settle, and for which reporting date.
Your role
Preparer of the IAS 19 workpaper
Level
Expert
Estimated time
≈ 60 min
Progress
0 / 5 steps done (review excluded)

Context

Sorbane SA (fictitious entity), a furniture manufacturer, closes its accounts on 31 December 20X6. You prepare the year-end employee benefits file: one defined contribution plan and three defined benefit pension plans, the short-term benefits, and the entries of the year. The file will be reviewed by the responsible partner. Teaching simulation: the review trail of the file (preparation, reviewer notes and final sign-off) is simulated for demonstration purposes; it is neither a real review nor a validation of the content.

Assignment

Short-term benefit accrual of Sorbane

Purpose of the workpaper

Record the benefits due at the closing date, their settlement date, the bonus formula and the past practice. Each benefit is recognised at the undiscounted amount expected to be paid; the judgment on the constructive obligation is supported, and the amounts, formulas and practices are case data.

Questions of the file covered by this workpaper

  • Compute the accrual for the unused leave that can be carried forward.
  • Is there an obligation at the closing date for the annual bonus and for the exceptional bonus of February?
  • Compute the annual bonus to recognise.
  • Compute the total short-term benefit liability.
  • Record the December salaries still due.
  • Record the accrual for the leave.
  • Record the annual bonus.

Documents in the file

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