Page 99 - OneVue Annual Report 2015

Notes to the financial statements

Note 40. Summary of significant accounting policies (continued)

Employee benefits

Short-term employee benefits

Liabilities for wages and salaries, including non-monetary benefits expected to be settled wholly within 12 months
after the end of the reporting period are recognised in other liabilities in respect of employees’ services rendered
up to the end of the reporting period and are measured at amounts expected to be paid when the liabilities are

settled. Liabilities for non-accumulating sick leave are recognised when leave is taken and measured at the actual
rates paid or payable.

Other long-term employee benefits

Liabilities for long service leave and annual leave are not expected to be settled wholly within 12 months after the
end of the reporting period. They are recognised as part of the provision for employee benefits and measured as
the present value of expected future payments to be made in respect of services provided by employees to the
end of the reporting period using the projected unit credit method. Consideration is given to expected future
salaries and wages levels, experience of employee departures and periods of service. Expected future payments are
discounted using corporate bond rates at the end of the reporting period with terms to maturity and currency that
match, as closely as possible, the estimated future cash outflows.Regardless of when settlement is expected to
occur, liabilities for long service leave and annual leave are presented as current liabilities in the statement of
financial position if the entity does not have an unconditional right to defer settlement for at least 12 months after
the end of the reporting period.
Related on-costs have also been included in the liability.

Share based payments

Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares that are provided to employees in
exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services,
where the amount of cash is determined by reference to the share price.

The cost of equity-settled transactions are measured at fair value on grant date. Fair value is determined using
either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the
option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the
expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting
conditions that do not determine whether OneVue receives the services that entitle the employees to receive
payment. No account is taken of any other vesting conditions.

The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the
vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award,
the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The
amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less
amounts already recognised in previous periods.

The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either
the Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the
award was granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:

• during the vesting period, the liability at each reporting date is the fair value of the award at that date
multiplied by the expired portion of the vesting period.

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