Document ID: chunk:federal_register_of_legislation:F2022C00493:reg:59b:p25
Version: federal_register_of_legislation:F2022C00493
Segment Type: reg
Provision Reference: reg 59B (pt 25/25)
Character Range: 123423–125836

separate share option grant, because each instalment has a different vesting period, and hence the fair value of each instalment will differ (because the length of the vesting period affects, for example, the likely timing of cash flows arising from the exercise of the options).

IG Example 1A
Background
An entity grants 100 share options to each of its 500 employees. Each grant is conditional upon the employee working for the entity over the next three years. The entity estimates that the fair value of each share option is CU15.
On the basis of a weighted average probability, the entity estimates that 20 per cent of employees will leave during the three-year period and therefore forfeit their rights to the share options.
Application of requirements
Scenario 1
If everything turns out exactly as expected, the entity recognises the following amounts during the vesting period, for services received as consideration for the share options.
Year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               Calculation                                            Remuneration expense for period  Cumulative remuneration expense
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          CU                               CU