BC252 SARs are economically similar to share options. Hence some argue that the accounting treatment of SARs should be the same as the treatment of share options, as discussed earlier (paragraph BC113). However, as noted in paragraphs BC240 and BC241, in an equity‑settled transaction there is one change in net assets (the goods or services received) whereas in a cash‑settled transaction there are two changes in net assets (the goods or services received and the cash or other assets paid out). To differentiate between the effects of each change in net assets in a cash‑settled transaction, the expense could be separated into two components:
- an amount based on the fair value of the SARs at grant date, recognised over the vesting period, in a manner similar to accounting for equity‑settled share‑based payment transactions, and
- changes in estimate between grant date and settlement date, ie all changes required to remeasure the transaction amount to equal the amount paid out on
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