Document ID: chunk:federal_register_of_legislation:F2023C00383:front:0:p3
Version: federal_register_of_legislation:F2023C00383
Segment Type: other
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Character Range: 5995–9060

AASB 1053 Application of Tiers of Australian Accounting Standards explains the two tiers of reporting requirements.

Accounting Standard AASB 119

The Australian Accounting Standards Board made Accounting Standard AASB 119 Employee Benefits under section 334 of the Corporations Act 2001 on 7 August 2015.

This compiled version of AASB 119 applies to annual periods beginning on or after 1 January 2023 but before 1 July 2026.  It incorporates relevant amendments contained in other AASB Standards made by the AASB up to and including 15 December 2022 (see Compilation Details).

Accounting Standard AASB 119

Employee Benefits

Objective
1 The objective of this Standard is to prescribe the accounting and disclosure for employee benefits. The Standard requires an entity to recognise:
(a) a liability when an employee has provided service in exchange for employee benefits to be paid in the future; and
(b) an expense when the entity consumes the economic benefit arising from service provided by an employee in exchange for employee benefits.
          AusCF1 AusCF entities are:
               (a) not-for-profit entities; and
               (b) for-profit entities that are not applying the Conceptual Framework for Financial Reporting (as identified in AASB 1048 Interpretation of Standards).
          For AusCF entities, the term 'reporting entity' is defined in AASB 1057 Application of Australian Accounting Standards and Statement of Accounting Concepts SAC 1 Definition of the Reporting Entity also applies. For-profit entities applying the Conceptual Framework for Financial Reporting are set out in paragraph Aus1.1 of the Conceptual Framework.

Scope
2 This Standard shall be applied by an employer in accounting for all employee benefits, except those to which AASB 2 Share-based Payment applies.
3 This Standard does not deal with reporting by employee benefit plans (see AASB 1056 Superannuation Entities).
4 The employee benefits to which this Standard applies include those provided:
(a) under formal plans or other formal agreements between an entity and individual employees, groups of employees or their representatives;
(b) under legislative requirements, or through industry arrangements, whereby entities are required to contribute to national, state, industry or other multi-employer plans; or
(c) by those informal practices that give rise to a constructive obligation. Informal practices give rise to a constructive obligation where the entity has no realistic alternative but to pay employee benefits. An example of a constructive obligation is where a change in the entity's informal practices would cause unacceptable damage to its relationship with employees.
5 Employee benefits include:
(a) short-term employee benefits, such as the following, if expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related services:
(i) wages, salaries and social security contributions;
(ii) paid annual leave and paid sick leave;
(iii) profit-sharing and bonuses;