Page 264 - Group Insurance and Retirement Benefit IC 83 E- Book

Employee Benefits 213

length of time for which payment is expected to be made. If the level of
benefit is the same for any disabled employee regardless of years of
service, the expected cost of those benefits is recognised when an event
occurs that causes a long-term disability.

Provided that a Small and Medium-sized Company, as defined in
the Notification, may not apply the recognition and measurement
principles laid down in paragraphs 129 to 131 of the Standard in respect
of accounting for other long-term employee benefits. However, such a
company should actuarially determine and provide for the accrued
liability in respect of other long-term employee benefits as follows:

The method used for actuarial valuation should be the
Projected Unit Credit Method.
The discount rate used should be determined by reference to
market yields at the balance sheet date on government bonds as
per paragraph 78 of the Standard.

Disclosure

132. Although this Standard does not require specific disclosures about
other long-term employee benefits, other Accounting Standards may
require disclosures, for example, where the expense resulting from such
benefits is of such size, nature or incidence that its disclosure is relevant
to explain the performance of the enterprise for the period (see AS 5 Net
Profit or Loss for the Period, Prior Period Items and Changes in
Accounting Policies). Where required by AS 18 Related
Party Disclosures an enterprise discloses information about other
long-term employee benefits for key management personnel.

Termination Benefits

133. This Standard deals with termination benefits separately from other
employee benefits because the event which gives rise to an obligation is
the termination rather than employee service.

Recognition

134. An enterprise should recognise termination benefits as a liability
and an expense when, and only when: