Page 195 - ACCESS BANK ANNUAL REPORTS_eBook

Depending on their grade, executive staff of the Bank upon retirement are entitled to certain bene-
fits based on their length of stay on that grade. The Bank’s net obligation in respect of the long term
incentive scheme is calculated by estimating the amount of future benefits that eligible employees
have earned in return for service in the current and prior years. That benefit is discounted to determine
its present value. The rate used to discount the post employment benefit obligation is determined
by reference to the yield on Nigerian Government Bonds, that have maturity dates approximating the
terms of the Bank’s obligations.

The calculation is performed annually by a qualified actuary using the projected unit credit method.
When the benefits of a plan are improved, the portion of the increased benefit relating to past service
by employees is immediately recognized in the income statement. The Bank recognizes all actuarial
gains or losses and all expenses arising from defined benefit plan immediately in the balance sheet,
with a charge or credit to other comprehensive income (OCI) in the years in which they occur. They are
not recycled subsequently in the income statement.

(d) Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as
the related service is provided.

A liability is recognised for the amount expected to be paid under short-term cash bonus or prof-
it-sharing plans if the Group has a present legal or constructive obligation to pay this amount as a
result of past service provided by the employee and the obligation can be estimated reliably.

(e) Share-based payment remuneration scheme
The Group applies IFRS 2 Share Based Payments in accounting for employee remuneration in the form
of shares.

Employee incentives include awards in the form of shares The cost of the employee services received
in respect of the shares or share granted is recognised in the income statement over the year that
employees provide services, generally the year between the date the award is granted or notified and
the vesting date of the shares. The overall cost of the award is calculated using the number of shares
and options expected to vest and the fair value of the shares or options at the date of grant.

The number of shares expected to vest takes into account the likelihood that performance and service
conditions included in the terms of the awards will be met. Failure to meet the non-vesting condition is
treated as a forfieture, resulting in an acceleration of recognition of the cost of the employee services.

The fair value of shares is the market price ruling on the grant date, in some cases adjusted to reflect
restrictions on transferability.

3.19 Share capital and reserves

(a) Share issue costs
Incremental costs directly attributable to the issue of an equity instrument are deducted from the
initial measurement of the equity instruments.

(b) Dividend on the Bank’s ordinary shares
Dividends on ordinary shares are recognised in equity in the year when approved by the Bank’s share-
holders. Dividends for the year that are declared after the end of the reporting year are dealt with in the
subsequent events note.

(c) Treasury shares
Where the Bank or any member of the Group purchases the Bank’s share capital, the consideration
paid is deducted from the shareholders’ equity as treasury shares until they are cancelled or disposed.
Where such shares are subsequently sold or reissued, any consideration received is included in share-
holders’ equity.

Access BAnk Plc 195
Annual Report & Accounts 2017