PAS 37

Provisions- Provisions can be distinguished from other liabilities such as trade

payables and accruals because there is uncertainty about the timing or amount of
the future expenditure required in settlement. Provisions represent funds put
aside by a company to cover anticipated losses in the future. In other words,
provision is a liability of uncertain timing and amount. Provisions are listed on a
company's balance sheet under the liabilities section.

Contingent Liabilities- A contingent liability is:

(a) A possible obligation that arises from past events and whose existence will
be confirmed only by the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control of the entity; or

(b) A present obligation that arises from past events but is notrecognised
because:

(i) It is not probable that an outflow of resources embodying economic

benefits will be required to settle the obligation; or

(ii) The amount of the obligation cannot be measured with sufficient

reliability.

Contingent Assets- A contingent asset is a possible asset that arises from past
events and who’s existence will be confirmed only by the occurrence or non-
occurrence of one or more uncertain future events not wholly within the control
of the entity. Contingent assets usually arise from unplanned or other unexpected
events that give rise to the possibility of an inflow of economic benefits to the
entity. An example is a claim that an entity is pursuing through legal processes,
where the outcome is uncertain.
PAS 12

Current Tax

Recognition – Unpaid tax for current and prior periods is recognized as a liability.
If the amount already paid in respect of current and prior periods exceeds the
amount due, the excess is recognized as an asset.

Measurement – Current tax liabilities (asset) is measured at the amount expected

to be paid or recovered, based on enacted or substantively enacted tax rates and
laws.

Presentation – Current tax assets and current tax liabilities can only be offset in
the statement of financial position if the entry has the legal right and the intention
to settle on net basis.

Deferred Tax
Recognition – Deferred tax recognized when there is a difference between the
carrying amount of an asset or liabilities and its tax base.

Measurement – Deferred tax is measured at the tax rates that are expected to
apply when the asset is realized or the liability is settled, base on enacted tax
rates and laws.

Presentation – Deferred tax assets and deferred tax liabilities can only be offset in
the statement of financial position if the entity has the legal right to settle current
tax amounts on a net basis and the deferred tax amounts are levied by the same
taxing authority on the same entity or different entities that intend to realise the
asset and settle the liability at the same time.

PAS 19 Employee benefits

1. Short-term employee benefits
Accounting Procedures
 Short-term employee benefits are those that an employee is entitled to receive
within 12 months after the end of the period in which the employee provided the
service to the company. Examples of short-term employee benefits include
wages, salaries, bonuses, medical care, and paid sick leave.
Recognition and Measurement
 Short-term employee benefits include recognizing the liability and expenses for
the benefits in the same period the employee provided the service. To recognize
and measure short-term employee benefits, the undiscounted amount of benefits
projected to be paid in exchange for employee service, less any amounts
previously paid, is recognized as a liability. If the amount paid is more than the
undiscounted amount, the excess is recognized as an asset. It can also be
recognized as an expense unless another standard requires or permits the
inclusion of the benefits in the cost of an asset.
  Furthermore, the cost of short-term paid absences is recognized when
employees render a service that increases their entitlement to future paid
absences or when those absences occur.
 The additional amount the business anticipates paying due to the unused
entitlement earned at the end of the reporting period is used to measure the
projected cost of accumulated paid absences.

2. Post-employment benefits (defined contribution plan)

Accounting Procedures
 A defined contribution plan is a type of post-employment benefit plan in which an
organization pays fixed contributions into a separate fund and has no further
obligation to contribute if the fund doesn't have enough assets to cover all
employee benefits related to their service.
Recognition and Measurement
 When an employee has provided service to an organization during a period, the
contribution payable to a defined contribution plan in exchange for that service
should be recognized as a liability, minus any contribution already paid. If the
contribution paid exceeds the amount due for service before the reporting
period's end, the excess can be recognized as an asset if it leads to a reduction
in future payments or a cash refund. The contribution is typically recognized as
an expense unless another standard allows it to be included in the cost of an
asset.
3. Post-employment benefits (defined benefit plan)
Accounting Procedures
 The accounting for defined benefit plan is making an assumption to measure
obligation, expense, actuarial gains and losses that is possible to happen in the
future. Moreover, the obligation should be measured on a discounted basis
because they can be settled many years after the employee renders their
service.
Recognition
 An entity shall recognize the net defined benefit liability as an asset in the
statement of financial position.
Measurement
 The defined benefit plan's maximum cost is uncertain, and this uncertainty will
likely persist over a long period. To measure the present value of the post-
employment benefit obligations and the related current service cost, there should
 be application of actuarial valuation method, attribute benefits to periods of
service and make actuarial assumptions.

4. Other long-term employee benefits

Accounting Procedures
 Other long-term employee benefits are all employee benefits other than short-
term, post-employment, and termination benefits. This uses a simplified method
of accounting for other long-term employee benefits. Unlike the accounting
needed for post-employment benefits, this method does not recognize
remeasurements in other comprehensive income.
Recognition and Measurement
 For other long-term employee benefits, an entity shall recognize the net total of
the following amounts in profit or loss, except to the extent that another standard
requires or permits their inclusion in the cost of an asset, like, service cost; net
interest on the net defined benefit liability and remeasurements of the net defined
benefit liability.

5. Termination Benefits.
Accounting Procedures
 Termination benefits are employee benefits provided in exchange for the
termination of an employee's employment as a result of either: termination of an
employee's employment before the normal retirement date or an employee's
decision to accept an offer of benefits in exchange for the termination of
employment.
Recognition
 When an entity offers termination benefits to employees, it must recognize a
liability and expense for those benefits at the earliest of two dates: when it can no
longer withdraw the offer, or when it recognizes costs for a restructuring that
involves the payment of termination benefits under PAS 37. If an entity
recognizes termination benefits, it may also have to account for changes to other
employee benefits as a result of plan amendments or curtailments.
Measurement
 An entity shall measure termination benefits on initial recognition, and measure
and recognize subsequent changes, per the nature of the entity shall apply the
requirements for post-employment benefits.
Names:
Lim, Eurica
Macabinta, Amerah
Madarang, Loraine
Mariano, Jhanna
Lucañas, Jerran ( walang tinulong)