Home' OzForex : Annual Report 2014 Contents 62 OzForex Annual Report 2014
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2014
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and accumulating sick and annual leave that
are expected to be settled wholly within 12 months after the end of the period in which the employees render
the related service are recognised in respect of employees' services up to the end of the reporting period and
are measured at the amounts expected to be paid when the liabilities are settled. The liability for accumulating
sick and annual leave is recognised in the provision for employee benefits. All other short-term employee benefit
obligations are presented as payables.
(ii) Other long-term employee benefit obligations
The liabilities for long service leave and employee bonus provisions are not expected to be settled wholly within
12 months after the end of the period in which the employees render the related service. They are therefore
recognised in 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 up to the end of the reporting period using
the projected unit credit method. Consideration is given to expected future wage and salary levels, experience
of employee departures and periods of service. Expected future payments are discounted using market yields
at the end of the reporting period of government bonds with terms and currencies that match, as closely as
possible, the estimated future cash outflows.
Provisions for unpaid employee benefits are derecognised when the benefit is settled, or is transferred to
another entity and the Group is legally released from the obligation and do not retain a constructive obligation.
xiii) Earnings per share
Basic earnings per share is calculated by dividing the Group's profit attributable to ordinary equity holders by the
weighted average number of ordinary shares outstanding during the financial year. Diluted earnings per share is
calculated by dividing the Group's profit attributable to ordinary equity holders by the weighted average number
of ordinary shares that would be issued on the exchange of all the dilutive potential ordinary shares into ordinary
shares. Refer to note 13 for information concerning the classification of securities.
xiv) Performance based remuneration
Share based payments
OzForex Group Long Term Incentive Plan
The Group provides benefits to its employees (including key management personnel) in the form of share-based
payments, whereby employees render services in exchange for shares or rights over shares (equity settled
transactions). There is currently one plan in place, the IPO performance rights issue, which provides benefits to
Executives identified by the Board. The fair value of each performance right is estimated at grant date using a
Monte Carlo simulation and discounted for the probability of employee retention and the probability of achieving
The cost of equity settled transactions is recognised, together with a corresponding increase in equity, over the
period in which the performance and/or service conditions are fulfilled (the vesting period), ending on the date on
which the relevant employees become fully entitled to the award (the vesting date). At each subsequent reporting
date until vesting, the cumulative charge to the income statement is in accordance with the vesting conditions as
set out under the Group's Long Term Incentive Plan (Note 21).
Equity settled awards granted by the Company to employees of subsidiaries are recognised in the subsidiaries'
separate financial statements as an expense with a corresponding credit to equity. As a result, the expense
recognised by the Group is the total expense associated with all such awards. Until an award has vested, any
amounts recorded are contingent and will be adjusted if more or fewer awards vest than were originally anticipated.
The Group currently does not provide benefits in the form of cash settled share-based payments.
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