Assignment 3 Accounting for Pensions and other Post Retirement Benefits

1548 Words Jan 12th, 2015 7 Pages
Assignment 3: Accounting for Pensions and other Post-Retirement Benefits

ACC 563 – Advanced Accounting Theory

Abstract
This paper will be based research, compare and contrast the early historical accounting for Postretirement Health Care and Life Insurance Benefits with the guidance / rules in place today with the Financial Accounting Standards Board (FASB) recently issued Statement of Financial Accounting Standards No. 158 "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans; changes to the guidance and rules that would improve the financial accounting and reporting of the benefits. Predict the significant manner in which the future of accounting for these benefits could
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158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, to reform accounting for pension and other postretirement benefit plans. The new changes required that employers offering defined benefit plans and post-retirement benefit plans report the funding status excess of pension assets over pension obligations overfunded or the excess of pension obligations over pension assets underfunded. Also, the net over or under funded amount must be booked as an asset overfunded or liability underfunded on the book of the employer offering the benefits. The new standard required that the employer recognize gains, losses and prior service costs that are not recognized in pension expense be recorded in other comprehensive income. Amendments for pensions are amortized over the remaining service life of the employees, while for Other Postemployment Benefits amendments are amortized over the period of time until full eligibility, a much shorter time span. Pension accounting requires the recording of an additional liability, when the accumulated benefit obligation exceeds the fair value of the plan assets. (www.fasb.org)
Predict future of accounting and political climate
I believe predict the potential impact of future changes on financial accounting and political climate, future changes the of Postretirement Health Care and Life Insurance Benefits representational faithfulness because the prepaid overfunded or unfunded obligations are reported which

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