F6- Pension Plans

Question 1

What are the components of pension expense/ net periodic pension cost for defined benefit plans?

Answer 1

S-ervice cost
I-nterest cost
R-eturn expected on cost assets
A-mortization on prior service cost
G-ain/losses (amortization)
E-xpected benefit obligation or net asset (amortization)

Question 2

What is the service cost for defined benefit cost?

Answer 2

The the increase in the projected benefit obligation based on the employee’s services rendered during the year.

Question 3

What net loss is amortized for pension cost?

Answer 3

If the unamortized net loss is greater than 10% of the greater of beginning PBO or FV of plan assets you: **amortize the excess over the avg. remaining service life.

Question 4

Under US GAAP, what is reported as accum OCI for pensions?

Answer 4

Unrecognized prior service costs, transition obligations/assets, and gain/losses, net of tax.
*service costs, obligations and losses are debits and assets and gains are credits.