IFRS Alert: Amendment to IAS 19 - Plan Amendment, Curtailment or Settlement

Executive summary 

The International Accounting Standards Board (IASB) has published ‘Plan Amendment, Curtailment or Settlement (Amendments to IAS 19)’. The amendments require companies to use updated actuarial assumptions to determine pension expenses following changes to a defined benefit pension plan. 

Main issues addressed by the amendments to IAS 19 

When a net defined benefit liability or asset is remeasured as a result of a defined benefit plan being amended, curtailed or settled during a period, the amendments to IAS 19 now require a company to:

  • determine the current service costs and the net interest for the period after the remeasurement using the assumptions used for the remeasurement; and
  • determine the net interest for the remaining period based on the remeasured net defined benefit liability or asset. 

These amendments are effective for annual reporting periods beginning on or after 1 January 2019, with early application permitted.