Graded vesting : When the share-based awards become exercisable on a gradual basis rather than all at once, this method of vesting is referred to as graded vesting. Cliff vesting : When the share-based awards become exercisable all at once, this method of vesting is referred to as cliff vesting. International Financial Reporting Standards (IFRS) : IFRS are a set of international accounting standards which are framed, approved, and published by International Accounting Standards Board (IASB) for the preparation and disclosure of international financial reports. Generally Accepted Accounting Principles (GAAP) : These are the guidelines necessary to create accounting principles for the implementation of financial information reporting in the Country U. To mention : The form of compensation received, whether the performance shares are cliff vesting or graded vesting, difference in IFRS and GAAP for accounting of graded vesting plans, as reported by Corporation AF

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Chapter 19, Problem 19.1AFKC

(1)

To determine

Graded vesting: When the share-based awards become exercisable on a gradual basis rather than all at once, this method of vesting is referred to as graded vesting.

Cliff vesting: When the share-based awards become exercisable all at once, this method of vesting is referred to as cliff vesting.

International Financial Reporting Standards (IFRS): IFRS are a set of international accounting standards which are framed, approved, and published by International Accounting Standards Board (IASB) for the preparation and disclosure of international financial reports.

Generally Accepted Accounting Principles (GAAP): These are the guidelines necessary to create accounting principles for the implementation of financial information reporting in the Country U.

To mention: The form of compensation received, whether the performance shares are cliff vesting or graded vesting, difference in IFRS and GAAP for accounting of graded vesting plans, as reported by Corporation AF

(2)

To determine

Earnings per share (EPS): The amount of earnings made available to each common share is referred to as earnings per share. Dilutive securities like convertible bonds, convertible preferred stock, and stock options, reduce the EPS by increasing the common shares.

To indicate: The EPS as reported in the income statement of Corporation AF for the year ended December 31, 2013, and mention if the company would have used a different classification, if the company used GAAP

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