## Other Long-term Employee Benefits

### Definition

Employee benefits (other than post-employment / retirement benefits and termination benefits) that are not expected to be settled wholly within 12 months after the end of the reporting period.

### Examples

Example	Nature
Sabbatical leaves	Long-term compensated absence
Long-term disability benefits	Disability / incapacity benefit
Any deferred compensation payable after 12 months	Other

### Accounting Treatment

Same framework as Defined Benefit Plan (Projected Unit Credit method).

All five components recognized:

1. Current Service Cost → P&L

2. Interest Cost → P&L

3. Expected Return on Plan Assets → P&L

4. Actuarial Gains/Losses → P&L

5. Past Service Cost → P&L

> Unlike short-term compensated absences (which use simple undiscounted values), other long-term benefits require full actuarial discounting.

⚠️ Common exam mistakes

Applying short-term (undiscounted) treatment to other long-term benefits such as sabbatical leaves
Confusing sabbatical leave (other long-term – payable after 12 months) with annual earned leave (short-term)
Treating other long-term benefits as post-employment benefits – they are not triggered by retirement

Bare-Act text Para 127 – Other Long-term Employee Benefits · AS 15 (Revised 2005) – ICAI · click to expand

For other long-term employee benefits, an enterprise should recognise the net total of the following amounts in profit and loss, except to the extent that another Accounting Standard requires or permits their inclusion in the cost of an asset: current service cost; interest cost; the expected return on any plan assets; actuarial gains and losses; past service cost; and the effect of any curtailments or settlements.

Now that you've read this — what's next?

Move from understanding → mastery in 3 clicks. Each option below picks up from this lesson's topic.

🔥 Drill 5 Qs on this → ✍️ Adaptive practice →

AS 15 – Other Long-term Employee Benefits

⚠️ Common exam mistakes