Singapore Airlines 2014 Annual Report Download - page 128

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NOTES TO THE FINANCIAL STATEMENTS
31 March 2014
SINGAPORE AIRLINES
2 Summary of Significant Accounting Policies (continued)
(ad) Employee benefits (continued)
(i) Equity compensation plans (continued)
This cost is recognised in the profit and loss account as share-based compensation expense, with a corresponding
increase in the share-based compensation reserve, over the vesting period in which the service conditions are
fulfilled, ending on the date on which the relevant employees become fully entitled to the award (“the vesting
date”). Non-market vesting conditions are included in the estimation of the number of shares under options that
are expected to become exercisable on the vesting date. At the end of each reporting period, the Group revises
its estimates of the number of shares under options that are expected to become exercisable on the vesting date
and recognises the impact of the revision of the estimates in the profit and loss account, with a corresponding
adjustment to the share-based compensation reserve over the remaining vesting period.
No expense is recognised for options or awards that do not ultimately vest, except for options or awards where
vesting is conditional upon a market condition, which are treated as vested irrespective of whether or not the
market condition is satisfied, provided that all other performance and/or service conditions are satisfied.
The share-based compensation reserve is transferred to general reserve upon cancellation or expiry of the vested
options or awards. When the options are exercised or awards are released, the share-based compensation reserve
is transferred to share capital if new shares are issued.
(ii) Defined benefit plans
The net defined benefit liability is the aggregate of the present value of the defined benefit obligation at the end
of the reporting period reduced by the fair value of plan assets (if any).
The cost of providing benefits under the defined benefits plans is determined separately for each plan using the
projected unit credit method.
Defined benefit costs comprise the following:
- Service cost
- Net interest on the net defined benefit liability
- Remeasurements of net defined benefit liability
Service costs which include current service costs, past service costs and gains or losses on non-routine settlements are
recognised as expense in profit or loss. Past service costs are recognised when plan amendment or curtailment occurs.
Net interest on the net defined benefit liability is the change during the period in the net defined benefit liability
that arises from the passage of time which is determined by applying the discount rate to the net defined benefit
liability. Net interest on the net defined benefit liability is recognised as expense in profit or loss.
Remeasurements comprising actuarial gains and losses, and return on plan assets are recognised immediately
in other comprehensive income in the period in which they arise. Remeasurements are recognised in retained
earnings within equity and are not reclassified to profit or loss in subsequent periods.