CERTYNEX IFRS ACADEMY

A controller writes: "Our share appreciation rights are settled in cash; we measured the liability at the grant-date fair value and will not adjust it again." What is the error?

The liability should have been measured at the date the cash is paid to the beneficiaries, and not at the grant date.

The liability should have been replaced by a reserve in equity, measured at the fair value of the grant date.

The liability is remeasured at each closing and at the settlement date, the changes going to profit or loss.

The changes in the fair value of the liability should have been taken to equity rather than to profit or loss for the year, like the other reserve items of the group.