CERTYNEX IFRS ACADEMY

Lumen SA has a plan settled, at vesting, either by delivering shares or by paying an equivalent amount in cash, at Lumen's choice. No commitment, practice or communication obliges Lumen to settle in cash (case facts). How does it classify the award?

As cash-settled, because the value of the award follows Lumen's share price.

As equity-settled, in the absence of a present obligation to settle in cash.

As cash-settled, because Lumen keeps the ability to pay in cash at vesting.

As a compound instrument, with a liability component and an equity component measured separately.