Which of the following is a necessary condition for a vested share-based payment?

A necessary condition for a vested share-based payment is that the vesting conditions must be satisfied. Vesting conditions are critical as they determine when an employee actually earns the right to the share-based payment. These conditions can be based on various factors such as the duration of employment or performance metrics, which are established to ensure alignment between the employee's contribution and the rewards received.

For a share-based payment to become vested, the employee must meet these specified conditions. Once met, the employee gains full rights to the shares or options, which may then be exercised or received, depending on the specific arrangement. This principle ensures that share-based payments effectively incentivize employees to contribute to the company’s long-term success, tying rewards directly to performance outcomes or time served.

In contrast, favorable capital markets, whether a company is publicly listed, or the nature of the payment (cash-based or otherwise), do not directly influence the occurrence of vesting. These factors may affect the overall environment in which share-based payments are issued or exercised but do not determine eligibility for vesting itself.