Requirement of Actuarial Valuation ervices in compliance of IndAS-19 under various employee benefits plans such as Gratuity, Leave Encashment , Pension, etc. :-
Accounting & Disclosure for Employee Benefits in Compliance of IndAS-19
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IndAS-19 is issued by the Institute of Chartered Accountants of India and is mandatory in nature (refer to the text of the standard for details).
The objective of the standard is to prescribed accounting and disclosure for employee benefits. The statement requires an enterprise to recognize:-
A liability when an employee has provided service in exchange for employee benefits to be paid in the future; and
An expense when the enterprise consumes the economic benefit arising from service provided by an employee in exchange for employee benefits.
Employee Benefits fall under 2 type of plans:-
Defined Contribution Plans and Defined Benefit Plans.
Employee Benefits are further classified as:-
Short Term Employee Benefits
Post Employment Benefits such as Gratuity, Pension, Other Retirement Benefits, Post-Employment Life Insurance and Post-Employment Medial Care;
Other Long-Term Employee Benefits, including long-service leave or sabbatical leave, jubilee or other long-service benefits, long-term disability benefits and, if they are not payable wholly within twelve months after the end of the period, profit-sharing, bonuses and deferred compensation; and
Termination Benefits
Because each category identified above has different characteristics, this statement establishes separate requirements for each category.
Accounting and Disclosure requirements for Defined Benefit Plans need the skill of an Actuary.
Most common Defined Benefits relevant in the Indian context which need the services of an actuary for compliance of the accounting standard, whilst finalizing the financial statements are:-
Gratuity
Compensated Absences (Earned Leave)
Compensated Absences (Sick Leave)
Post Retirement Medical Benefits
Superannuation (Pension Benefits)
Frequent items to be conversant with the subject are:-
Projected Unit Credit Method (PUC)
Projected Benefit Obligation at the Start of the Accounting Period
Current Service Cost
Past Service Cost
Curtailments/settlements
Interest Cost in Indian GAAP
Net Interest Cost (Income) in IAS -19 (Revised 2011) under IFRS
Other Comprehensive Income and Reimbursements in IAS -19 (Revised 2011) under IFRS
Actuarial Gain/Losses in AS -15 (Revised 2005)
Actuarial (gains)/losses arising from experience adjustment in IndAS 19
Actuarial (gains)/losses arising from changes in Financial Assumptions in IndAS 19
Actuarial (gains)/losses arising from changes in Demographic Assumptions in IndAS 19
Projected Benefit Obligation at the End of the Accounting Period
Current and Non- Current Obligations as required Revised Schedule VI in Indian GAAP
*We provide actuarial services for compliance of the standard. We have expertise, experience and in-depth knowledge in this field. We have a large clientele spread in almost all sectors of the economy in Public and Private Sectors including Multinational Companies, Limited Companies, Schools, Hospitals, Banks, Electricity/Power Companies etc. etc.
Our services are also available for compliance of :-
International Accounting Standard IAS (19) – IFRS, NAS-19 (Nepal Accounting Standard)-19 & US GAAP
For more details you may send your requirements on emails: - mlsodhi @ yahoo.co.in or you may visit website at you may visit our website : www.mlsodhiactuary.com
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