QUESTION 1 A company issued share options on 1 June 20X6 to pay for the purchase of inventory. The inventory is eventually sold on 31 December 20X8. The value of the inventory on 1 June 20X6 was 6m and this value was unchanged up to the date of sale. The sale proceeds were 8m. The shares issued have a market value of 6.3m. How will this transaction be dealt with in the financial statements? A company grants 2,000 share options to each of its three directors on 1 January 20X6, subject to the directors being employed on 31 December 20X8. The options vest on 31 December 20X8. On the grant date, it is anticipated that the company's share price will reach 14 per share at the end of 31 December 20X8. On 1 January 20X6, the fair value of each option is 10 and it is anticipated that all of the share options will vest on 31 December 20X8. On 31 December 20X6, it is anticipated that only two directors will be employed on 31 December 20X8. How will the share options be treated in the financial statements for the year ended 31 December 20X6? A public limited company, has granted 300 share appreciation rights to each of its 500 employees on 1 July 20X5. The management feel that as at 31 July 20X6, the year-end, 80% of the awards will vest on 31 July 20X7. The fair value of each share appreciation right on 31 July 20x6 is 15. What is the fair value of the liability to be recorded in the financial statements for the year ended 31 July 20X6? A company grants 100 cash-settled awards to each of its 500 employees on the condition that the employees remain in its employment for the next three years. Cash is payable at the end of three years based on the share price of the entity's shares on such date. During year 1, 35 employees leave. The entity estimates that 60 additional employees will leave during years 2 and 3. The share price at year-end is 14.40. During year 2, 40 employees leave and the entity estimates that 25 additional employees will leave during year 3. The share price at year-end is 15.50. During year 3, 22 employees leave. The share price at year-end is 18.20. What is the cost of this award for each year? Which are the three main categories of disclosures required by IFRS 2 (Share-based payments) and which purpose are these disclosures expected to serve? (20 %)