Changes
in Pension Accounting: FAS No. 158
- Major
change: An entity must recognize in its statement of financial
position an
asset for a plan's overfunded status or a liability for a plan's
underfended status.
- FAS No. 87 only
required limited recognition of an underfunded plan--called the
"minimum
liability." This was the difference between the "accumulated
benefit obligation" and the fair value of plan assets.
- An
entity must recognize changes in the funded status of a defined
benefit post retirement plan in the year in which the changes occur.
Those changes will be reported in comprehensive income.
- an
employer should continue to apply the provisions in Statements 87, 88,
and 106 in measuring plan assets and benefit obligations as of the date
of its statement of financial position and in determining the amount of
net periodic benefit cost.
- FAS No. 158 does
not impact the calculation of periodic pension expense; same as under
FAS No. 87.
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