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Chapter 4

1.2 Accounting for equity-settled share-based payments

Equity-settled
SBP’s

Used to pay 3rd Used to pay
parties employees

Direct method Indirect method
Use:
Value at fair value of
item purchased  FV of option at GRANT
DATE
 Based on options

expected to vest

 Spread over vesting
period

Dr P/L or Asset Dr P/L

Cr Equity Cr Equity

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