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ACCA Strategic Professional · Strategic Business Reporting (International) · Other reporting issues

Alder plc's finance director, Ms Rowan, is a member of key management personnel. Alder pays her a salary, a bonus and contributions to a post-employment plan, and also grants her share options. Under IAS 24, which statement about disclosure of her compensation is correct?

IAS 24 requires key management personnel compensation to be disclosed in total and analysed by category: short-term benefits, post-employment benefits, other long-term benefits, termination benefits and share-based payment. Share options and pension contributions are therefore included, not just salary and bonus, and no shareholding condition applies.

  1. AOnly the cash salary and bonus need disclosure, as other benefits are not transactions
  2. BKey management personnel compensation must be disclosed in total and analysed by category, including short-term benefits, post-employment benefits and share-based paymentCorrect
  3. CCompensation is disclosed only if the director is also a shareholder holding more than 20%
  4. DCompensation is exempt from disclosure because it is covered by IAS 19

Explanation

IAS 24 requires disclosure of key management personnel compensation in total and for each category: short-term employee benefits, post-employment benefits, other long-term benefits, termination benefits and share-based payment. Limiting disclosure to cash items ignores the categories required. No shareholding threshold applies.

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