What companies are covered by IAS 19?
The recommendation comprises listed companies. A number of Swedish companies are indirectly covered by IAS 19 through foreign owners who apply the IFRS regulatory framework.
The IASB issues the IAS 19 regulatory framework
The IAS 19 regulatory framework is issued by an independent organisation, the IASB (International Accounting Standards Board). The IASB’s mission is to strive for international harmonisation of the accounting principles used in various countries throughout the world.
Valuation according to international accounting standards compared with Swedish liability valuation
Under IAS 19, the present value of a defined-benefit pension obligation must be valued according to the PUC method (Projected Unit Credit Method). Unlike Swedish liability valuation, the PUC method takes into account future accrual of pension entitlements. Based on company-specific assumptions, the future cash flow is calculated to present value.