IFRS 2Chapter 11Lesson 2
Deferred tax and replacement awards in a business combination
Step 1 of 4Learning objectives
Go deeper+2 deeper insights · +2 calculations · +1 journal entry · +1 point of attention
The expected tax benefit of an award gives a deferred tax asset, the part of which exceeding the cumulative expense goes to equity; in a business combination, the part of a replacement award relating to pre-combination service is part of the consideration transferred.
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Learning objectives
- Recall how the cumulative expense for the period is calculated.
- Calculate the deferred tax asset on an award and the part of the tax benefit taken to equity.
- Analyse the split of the fair value of a replacement award between pre-combination and post-combination service.