BC52 Although IAS 19 before its revision in 1998 did not deal explicitly with the recognition of retirement benefit obligations as a liability, it is likely that most entities recognised a liability for retirement benefit obligations at the same time under the requirements in IAS 19 before and after its revision in 1998. However, the requirements in IAS 19 before and after its revision in 1998 differed in the measurement of the resulting liability.

BC53 Paragraph 63 of IAS 19 is based on the definition of, and recognition criteria for, a liability in the IASC's Framework for the Preparation and Presentation of Financial Statements (Framework). [References to the Framework in this Basis for Conclusions are to the IASC's Framework for the Preparation and Presentation of Financial Statements, adopted by the Board in 2001 and in effect when the Standard was revised.] The Framework defined a liability as 'a present obligation of the entity arising from past events, the settlement of which is expected to result in an outflow from the entity of resources embodying economic benefits'. The Framework stated that an item which meets the definition of a liability should be recognised if:

(a) it is probable that any future economic benefit associated with the item will flow from the entity; and

(b) the item has a cost or value that can be measured with reliability.

BC54 IASC believed that: