BU397 Chapter Notes - Chapter 19: Pension, Expected Return, Income Statement
Document Summary
Benefits paid to retirees: pension benefits are paid to retirees (former employees) Like all liabilities, the amount owing is decreased as these payments are made. Past service costs: similar to dc plans, when a plan is started or amended, credit is often given for past years of service. This amount is included in the pension benefit cost on the income statement in the year it is incurred: note that companies can also amend plans to reduce the benefits received. Results in a decreased dbo and a past service benefit. Acturial gains and losses: these gains and losses can occur because of: Difference between what actually happened and the actuarial assumption that was made. = plan assets, fair value at end of period. * ifrs: actual return = expected return + remeasurement gain or remeasurement. Look at contributions beginning of year, halfway through the year, or end of year loss on assets.
