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Chapter 9
Cash-settled schemes
3.1 The accounting entry
When an entity receives a good or a service as a result of a cash-settled share-
based payment, it posts the following accounting entry:
Dr Asset/Expense X
Cr Liabilities X
3.2 Valuation
Until settled, the entity re-measures the fair value of the liability at each reporting
date.
3.3 Timing
Where services are received in exchange for cash-settled share-based payments,
the expense is recognised over the period that the services are rendered (the vesting
period).
Illustrations and further practice
Now try Illustration 2 from Chapter 9.
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