Document ID: chunk:federal_register_of_legislation:F2022C00493:reg:3:p2
Version: federal_register_of_legislation:F2022C00493
Segment Type: reg
Provision Reference: reg 3 (pt 2/2)
Character Range: 211249–218461

400 × 6)             (4,200)
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Salary deduction paid to the savings plan  600
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  (25% × 400 × 6)                                 (600)
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Refund of contributions to the employee                                           (1,800)           1,800
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Share-based payment
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       (acceleration of remaining expense)        240
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  (120 × 3 – 120)                                                   (240)
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Total                                                         5,040               (6,000)           1,200           (240)

IG16 Paragraph 24 of the Standard requires that, in rare cases only, in which the Standard requires the entity to measure an equity-settled share-based payment transaction by reference to the fair value of the equity instruments granted, but the entity is unable to estimate reliably that fair value at the specified measurement date (eg grant date, for transactions with employees), the entity shall instead measure the transaction using an intrinsic value measurement method. Paragraph 24 also contains requirements on how to apply this method. The following example illustrates these requirements.

IG Example 10
Grant of share options that is accounted for by applying the intrinsic value method
Background
At the beginning of year 1, an entity grants 1,000 share options to 50 employees. The share options will vest at the end of year 3, provided the employees remain in service until then. The share options have a life of 10 years. The exercise price is CU60 and the entity's share price is also CU60 at the date of grant.
At the date of grant, the entity concludes that it cannot estimate reliably the fair value of the share options granted.
At the end of year 1, three employees have ceased employment and the entity estimates that a further seven employees will leave during years 2 and 3. Hence, the entity estimates that 80 per cent of the share options will vest.
Two employees leave during year 2, and the entity revises its estimate of the number of share options that it expects will vest to 86 per cent.
Two employees leave during year 3. Hence, 43,000 share options vested at the end of year 3.
The entity's share price during years 1–10, and the number of share options exercised during years 4–10, are set out below. Share options that were exercised during a particular year were all exercised at the end of that year.
Year                                                                                                                                                                                                                                                                                                                                                                                                                     Share price at year-end  Number of share options exercised at year-end