Employee Benefits Flashcards

1
Q

Where do companies put contributions towards?

A

Pension Funds

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2
Q

Who are the liabilities in terms of Pensions?

A

Pensioners because the company is liable to pay the pensioners pension

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3
Q

How do we pay our pensioners?

A

Using our asset

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4
Q

What is defined benefit obligations?

A

Guaranteeing Pensioners will get paid and will get all the benefit.

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5
Q

What is a Current Service cost and what is the double entry for this?

A

If you got an employee or employees who worked for this year, they deserve more pension therefore it increases pension liability.

Dr I/S Cr Pension Liability

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6
Q

What is Past Service cost?

What is the double entry for this?

A

When Payment schemes are changing so you owe your employees more money for services ended in the past

Dr I/S Cr Pension Liability

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7
Q

What is the double entry for contribution?

A

Dr Pension Asset Cr Cash

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8
Q

What is the double entry for Benefit paid

A

Dr Pension Liability Cr Pension Asset

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9
Q

What is the double entry for expected return?

A

Dr Pension Asset Cr Interest

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10
Q

What is the double for Unwinding for interest

A

Dr Interest Cr Pension Liability

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11
Q

Where do recognise the Actuarial Re measurement?

A

OCI

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12
Q

What is Curtailment?

A

A curtailment occurs when there are a significant number of employees who leave the scheme, commonly
seen if there is a re-organisation of the business or change in scheme from defined benefit to defined
contribution

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13
Q

What is the asset ceiling test

and where do we treat if there are any impairment loss?

A

Asset Ceiling Test is when the net pension asset cannot be shown more than the recoverable amount.

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