Where a surplus exists an entity must assess whether the asset is recoverable. If recoverable, the asset is measured at the lower of:
i. The asset determined under IFRS (i.e., fair value of plan assets plus unrecognised past service costs and actuarial losses (less gains) less the present value of plan obligations; and
ii. The sum of the present value of any future
refunds or reductions in future contributions, any unrecognised net actuarial losses (corridor method only), and unrecognised past service costs.
IFRIC 14 IAS 19 — The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction (‘IFRIC 14’) clarifies when refunds or reductions in future contributions are regarded as available in terms of the recoverability of the asset, and how a minimum funding requirement might affect the availability of reductions in future contributions or give rise to a liability.