Long-service leave that is payable beyond 12 months after the financial year is to be measured at its present value.

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This is in accordance with the accounting standards in most jurisdictions, including Australia and New Zealand. Present value refers to the discounted value of a future cash flow, which takes into account the time value of money and the uncertainty of the future. In the case of long-service leave, which is a type of employee benefit payable after a certain period of service, the present value method is used to measure the liability because it reflects the economic value of the benefit at the reporting date. This ensures that the financial statements provide a fair and reliable representation of the entity's obligation to its employees.

Long-Service Leave That Is Payable Beyond 12 Months After the Financial