End of Service Benefits
Code: 2231Account Information
| Financial Statement | Statement of Financial Position |
| Normal Balance | Credit |
Definition
The accumulated obligation for employees’ end-of-service benefits. This account is used to recognise and update the obligation and is reduced when benefits are paid.
Common Journal Entries
Dr. End of Service Expense
Cr. End of Service Benefits
Dr. End of Service Benefits
Cr. Bank Account
Dr. End of Service Expense
Cr. End of Service Benefits
Dr. End of Service Benefits
Cr. Other Income
Dr. End of Service Expense
Cr. End of Service Benefits
Dr. End of Service Benefits
Cr. Bank Account
Dr. End of Service Expense
Cr. End of Service Benefits
Dr. End of Service Benefits
Cr. Other Income
📐 IFRS vs US GAAP Accounting Treatment
❓ Frequently Asked Questions
A: End-of-service benefits are calculated under the employment law or contract applicable to the employee. The accumulated obligation is updated periodically under the appropriate accounting treatment.