psak 24 jmd sent
TRANSCRIPT
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PSAK 24 Employee Benefits
Konvensi Nasional Akuntansi VIIYogyakarta, 28 Juni 2012
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Agenda
1 Brief history
2 Main changes
3 Key takeaways
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Brief history of PSAK 24
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Brief history of PSAK 24and where to after this?
Timeline Events
Sep 1994 PSAK 24 Accounting for Pension Benefit Costs.
Adopted from IAS 19 Retirement Benefit Costs (1993)
Jun 2004 PSAK 24 Employee Benefits. Effective 1 July 2004
Adopted from the version of IAS 19 Employee Benefits, which
was initially issued in 1998 and subsequently amended several
.Oct 2010 PSAK 24 Employee Benefits. Effective 1 January 2012.
Adopted from IAS 19 per 1 January 2009
_ _ _ _ _? On 16 June 2011 the IASB issued IAS 19 Employee Benefits, which iseffective from 1 January 2013. These amendments finalize proposals inthe ED Defined Benefit Plans, published in April 2010 and proposals
related to termination benefits in the ED IAS 37 Provisions,Contingent Liabilities and Contingent Assets, published in June 2005.
Will PSAK 24 follow suit?
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Main changes of PSAK 24
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Some differences with PSAK 24 (2004)
Additional option in recognizing actuarial gains or losses
More extensive disclosures for defined benefit plans
Others, like:
more gui ance on sc emes re ate to socia security, mu ti-emp oyerand common control entities
clarification on impacts of PSAK 1 and PSAK 7 on certainclassification and disclosure requirements of employee benefits
exclusion of provision regarding the disclosure requirements forshare-based employee benefit payments.
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Options in recognizing actuarial gains or losses
Corridor approach
Other systematic method that results in fasterrecognition
Recognizing actuarial gains and losses in Other
they occur
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Main new disclosure requirements for definedbenefit plans
More specific details on the reconciliation of the presentvalue of defined benefit obligation and fair value of planassets
Total amount recognized in other comprehensive income
for actuarial gains or losses and asset ceiling adjustment Cumulative amounts of actuarial gains or losses
recognized in other comprehensive income
Fair value of each major category of plan assets
Narrative explanation on expected return of plan asset
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Main new disclosure requirements for definedbenefit plans
Effect of 1% increase/decrease in assumed medical costtrend rate
5 years disclosures on:
Present value of defined benefit obligation
a r va ue o p an asse s
Surplus/deficit of the plan
Experience adjustment
Employers best estimate of contribution expected to bepaid to the plan for next year
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Disclosures Reconciliation ofpresent value of defined benefit obligation
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Source: PricewaterhouseCoopers LLP, Illustrative IFRS corporate consolidatedfinancial statements for 2009 year ends.
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Disclosures Reconciliation offair value of plan assets
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Source: PricewaterhouseCoopers LLP, Illustrative IFRS corporate consolidatedfinancial statements for 2009 year ends.
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Disclosures Actuarial gains or lossesrecognized in OCI
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Source: PricewaterhouseCoopers LLP, Illustrative IFRS corporate consolidatedfinancial statements for 2009 year ends, 2009.
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Disclosures Fair value ofeach major category of plan assets
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Source: PricewaterhouseCoopers LLP, Illustrative IFRS corporate consolidatedfinancial statements for 2009 year ends.
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Disclosures Narrative explanation onexpected return on plan assets
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Source: PricewaterhouseCoopers LLP, Illustrative IFRS corporate consolidatedfinancial statements for 2009 year ends.
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Disclosures Effect of an increase & decrease of1 % point in the assumed medical cost trend rate
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Source: PricewaterhouseCoopers LLP, Illustrative IFRS corporate consolidatedfinancial statements for 2009 year ends.
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Disclosures 5 years disclosures
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Source: PricewaterhouseCoopers LLP, Illustrative IFRS corporate consolidatedfinancial statements for 2009 year ends.
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Transitional provision
If the Other Comprehensive Income method of recognizingactuarial gains or losses is elected, then any unrecognizedactuarial gains or losses at the beginning of the adoption ofthis standard is adjusted to OCI as of that date, which will
ainly be on 1 January 2012.
Except for certain items, amended disclosure requirementsshould generally be applied on a retrospective basis.
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Key takeaways
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Things to consider
The choice of the method of recognizing actuarial gains orlosses may have a significant implications on the P&L;hence, may warrant an early discussion with thestakeholders.
Changes in the disclosure requirements may need earlypreparation of data and discussion with the actuary.
Stay tuned for the next possible wave of change
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Thank You