2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (m) Employee benefits (i) Short-term employee benefits Short-term employee benefit obligations in respect of salaries, bonuses, paid annual leave and sick leave are measured on an undiscounted basis and are recognised in profit or loss in the period in which the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profit–sharing plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. (ii) State plans The Group’s contributions to the statutory pension funds are charged to profit or loss in the period to which they relate. Once the contributions have been paid, the Group has no further payment obligations. (iii) Share-based payment transactions The grant date fair value of share-based payment granted to employees is recognised as an employee expense, with a corresponding increase in equity, over the period that the employees unconditionally become entitled to the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting conditions are expected to be met, such that the amount ultimately recognised as an expense is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the fair value of the share-based payment at grant date is measured to reflect such conditions and there is no true–up for differences between expected and actual outcomes. The fair value of the employee share options is measured using a binomial option pricing model. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behaviour), expected dividends and risk–free interest rate. Service and non-market performance conditions attached to the transactions are not taken into account in determining fair value. (iv) Termination benefits Termination benefits are recognised in profit or loss at the earlier of when the Group can no longer withdraw the offer of those benefits and when the Group recognises costs for a restructuring. If benefits are not expected to be settled wholly within 12 months at the end of the reporting period, then they are discounted. Integrated Report 2023 219
RkJQdWJsaXNoZXIy NDgzMzc=