BANCO BILBAO VIZCAYA ARGENTARIA, S.A. AND ... - BBVA

The present values of the vested obligations for post-employment welfare benefits are quantified on a caseby-case
basis. They are recognized in the heading “Provisions – Provision for pensions and similar
obligations” in the accompanying consolidated balance sheets (see Note 25) and they are charged to the
heading “Personnel expenses – Other personnel expenses” in the accompanying consolidated income
statements (see Note 46).
Other long-term commitments to employees
Some of the Group’s companies are obliged to deliver goods and services. The most significant, in terms of
the type of compensation and the event giving rise to the commitments are as follows: loans to employees,
life insurance, study assistance and long-service bonuses.
Some of these commitments are measured according to actuarial studies, so that the present values of the
vested obligations for commitments with personnel are quantified on a case-by-case basis. They are
recognized in the heading “Provisions – Other provisions” in the accompanying consolidated balance sheets
(see Note 25).
The welfare benefits delivered by the Spanish companies to active employees are recognized in the heading
“Personnel expenses - Other personnel expenses” in the accompanying income statements (see Note 46).
Other commitments for current employees accrue and are settled on a yearly basis, so it is not necessary to
record a provision in this connection.
2.2.13. EQUITY-SETTLED SHARE-BASED PAYMENT TRANSACTIONS
Equity-settled share-based payment transactions, when the instruments granted do not vest until the
counterparty completes a specified period of service, shall be accounted for those services as they are
rendered by the counterparty during the vesting period, with a corresponding increase in equity. The entity
measures the goods or services received and the corresponding increase in equity, directly, at the fair value
of the goods or services received, unless that fair value cannot be estimated reliably. If the entity cannot
estimate reliably the fair value of the goods or services received, the entity measures their value and the
corresponding increase in equity indirectly, by reference to the fair value of the equity instruments granted, at
grant date.
When the initial compensation agreement includes what may be considered market conditions among its
terms, any changes in these conditions will not be reflected on the profit and loss account, as these have
already been accounted for in calculating their initial fair value. Non-market vesting conditions are not taken
into account when estimating the initial fair value of instruments, but they are taken into account when
determining the number of instruments to be granted. This will be recognized on the income statement with
the corresponding increase in equity.
2.2.14. TERMINATION BENEFITS
Termination benefits must be recognized when the Group is committed to severing its contractual
relationship with its employees and, to this end, has a formal detailed redundancy plan. There were no
redundancy plans in the Group entities, so it is not necessary to recognize a provision for this item.
2.2.15. TREASURY STOCK
The amount of the equity instruments that the Group's entities own is recognized under “Stockholders’ funds
- Treasury stock” in the accompanying consolidated balance sheets. The balance of this heading relates
mainly to Bank shares held by some of its consolidated companies (see Note 30).
These shares are recognized at acquisition cost, and the gains or losses arising on their disposal are
credited or debited, as appropriate, to the heading “Stockholders’ funds - Reserves” in the accompanying
consolidated balance sheets (see Note 29).
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