Notes to the Financial Statements
(Cont’d)
For the year ended 30 April 2015
(In Singapore Dollars)
55
STAMFORD TYRES CORPORATION LIMITED
BUILDING ON OUR EXTENSIVE NETWORK
2.
Summary of significant accounting policies (cont’d)
2.19
Employee benefits (cont’d)
(b)
Employee leave entitlement
Employee entitlements to annual leave are recognised as a liability when they accrue to employees.
The estimated liability for leave is recognised for services rendered by employees up to the end of
each reporting period.
(c)
Executives’ Share Option Scheme
The Company has in place the STC Share Option Scheme 2001 (the “Scheme”) for the granting
of share options to eligible employees of the Group to subscribe for ordinary shares in the
Company, whereby employees render services as consideration for share options (“equity-settled
transactions”).
The cost of equity-settled transactions with employees is measured by reference to the fair value
at the date on which the share options are granted. In valuing the share options, no account is
taken of any performance conditions, other than conditions linked to the price of the shares of the
Company (‘market conditions’), if applicable.
The cost of equity-settled transactions is recognised in profit or loss with a corresponding increase
in the employee share option reserve, over the period in which the performance and/or service
conditions are fulfilled, ending on the date on which the relevant employees become fully entitled
to the award (‘the vesting date’). The cumulative expense recognised for equity-settled transactions
at each reporting date until the vesting date reflects the extent to which the vesting period has
expired and the Group’s best estimate of the number of share options that will ultimately vest.
The charge or credit to profit or loss for a period represents the movement in cumulative expense
recognised as at the beginning and end of that period and is recognised in the employee benefits
expense.
No expense is recognised for options that do not ultimately vest, except for option 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.
Where the terms of an equity-settled transaction award are modified, the minimum expense
recognised is the expense as if the terms had not been modified, if the original terms of the award
are met. An addition expense is recognised for any modification that increases the total fair value
of the share-based payment transaction, or is otherwise beneficial to the employee as measured at
the date of modification.
Where an equity-settled transaction award is cancelled, it is treated as if it had vested on the date
of cancellation, and any expense that otherwise would have been recognised for services received
over the remaining vesting period is recognised immediately. However, if a new award is substituted
for the cancelled award, and designated as a replacement award on the date that it is granted,
the cancelled and new awards are treated as if they were a modification of the original award, as
described in the previous paragraph.
