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CA Final · Financial Reporting · Ind AS 102 Share Based Payment

Sundaram Textiles Ltd grants share options to its employees. While preparing its accounts, the finance head states that the fair value of these options will be measured under Ind AS 113 Fair Value Measurement because the term 'fair value' has one common meaning across all Ind AS. Which statement is correct as per Ind AS 102?

Fair value for share-based payments is measured under Ind AS 102 itself, not Ind AS 113. Paragraph 6A explains that Ind AS 102 uses the term fair value differently in some respects from Ind AS 113, so the entity must follow Ind AS 102's own measurement requirements.

  1. AFair value is measured under Ind AS 113 because Ind AS 102 adopts its definition without change
  2. BFair value is measured in accordance with Ind AS 102, because the Standard uses the term differently from Ind AS 113Correct
  3. CFair value may be measured under either Ind AS 102 or Ind AS 113 at the entity's option
  4. DFair value is measured under Ind AS 113 for equity-settled awards and under Ind AS 102 for cash-settled awards

Explanation

Paragraph 6A states that Ind AS 102 uses 'fair value' in a way that differs in some respects from Ind AS 113. Therefore the entity measures fair value in accordance with Ind AS 102, not Ind AS 113. The option allowing a choice or a split by settlement type has no basis in the Standard.

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