Pensions Flashcards
Prior Service Cost Amortization amount is calculated?
Total credit / average working life remaining
Service cost is measured?
Change in the Projected Benefit Obligation (PBO)
Footnote disclosures do not require…
Differences in executive and non-executive plans
Accumulated Benefit Obligation
Present value of all future retirement payments attributed by the pension benefit formula to employee services rendered prior to that date and based on past and current compensation levels
Net Periodic Pension Costs
SIR AGE. AGE = Unamortized is in AOCI (net of tax)
Interest cost calculation
Beginning PBO x Interest Rate
Return on plan assets calculation (negative)
Beginning FV x Expected Rate
Amortization of Transition Asset
Accumulated amount / average remaining service life
Corridor Approach amortization
(Unrecognized G/L - 10% of beginning PBO or FV (greater))/average remaining service life
Funded status calculation
FV of plan assets - PBO
Over-funded status
Non-current Asset
Under-funded Status
Non-current Liability. Current liability to the extent benefits payable - next year exceeds FV
Amortization of net gain results in a
increase to retained earnings
IFRS gains
Considered remeasurements from actuarial gains, reported in AOCI, and NOT amortized to the income statement
Disclosures
The more, the better!
IFRS - Prior service costs
Under IFRS, past service cost is recognized on the income statement in the period of the plan amendment.
If PBO > FV, what is reported on BS
a liability of the difference
Pension plan investment assets reported at…..
FV in the defined benefit plan’s financial statement
EOY FV plan asset calc
FV Beginning + Contributions - benefits paid + Return on plan assets
Funded status is disclosed where?
The statement of financial position.
If unsure about what to value stuff in the financials…
go with FV
Multiple plans’ funded status should be reported…
Separately
