CERTYNEX IFRS ACADEMY

A colleague writes: "At the N2 closing we revised downwards the number of options expected. This revision applies to future periods only: the N1 expense already recognised stays unchanged." What is the error?

The revision gives rise to a cumulative catch-up: the cumulative expense is recomputed and the difference goes to profit or loss.

He forgets to recompute the unit fair value of the options at the N2 closing, which must reflect the new expected number.

He charges the revision directly to equity, without taking it through the profit or loss of the periods concerned.

He forgets that the revision of the expected number applies from the time employees exercise the options.