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Basic Question 10 of 17
Pension plan assets are not recognized in the company's accounts or its financial statements. True or False?
User Contributed Comments 5
| User | Comment |
|---|---|
| jkc2007 | i believe the new gaap (under the new 2008 cfa curriculum) requires both plan assets and liabilities be recognized on the balance sheet. could anyone clarify? |
| ehc0791 | The net of PBO and plan assets should be recognized on B/S, not each of them. |
| bmeisner | Ok I just read through the section you guys are refering to, it seems that the number is still netted off as ehc mentioned. It seems the difference is that the liability recognized is PBO - fair value of plan assets instead of ABO - fair value of plan assets as in the minimum liability rule. This only affects the balance sheet including liabilities and shareholders equity, but it still does not affect the income statement. See page 137 of the reading. |
| quanttrader | only funded status |
| UcheSam | Is notes to the accounts not part of the financial statements? |
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Learning Outcome Statements
explain and calculate how adjusting for items of pension and other post-employment benefits that are reported in the notes to the financial statements affects financial statements and ratios;
interpret pension plan note disclosures including cash flow related information;
CFA® 2025 Level II Curriculum, Volume 2, Module 11.