INTERMEDIATE ACCOUNTING（赖红宁）4-4--CH19.pptVIP

Objectives 1. Understand the characteristics of pension plans. 2. Explain the historical perspective of accounting for pension plans. 3. Explain the accounting principles for defined benefit plans, including computing pension expense and recognizing pension liabilities and assets. 4. Account for pensions. 5. Understand disclosures of pensions. Characteristics of Pension Plans Pension Relationships Amortization of Unrecognized Prior Service Cost Gain or Loss 1. Amortization of any unrecognized net loss from previous periods (added to compute pension expense), or 2. Amortization of any unrecognized net gain from previous periods (deducted to compute pension expense). Components of Pension Expense Additional Pension Liability Disclosures Pension Expense Equal to Funding Pension Expense Greater Than Pension Funding Pension Fund Less Than Pension Funding and Expected Return Different From Discount Rate Pension Expense Including Amortization of Unrecognized Prior Service Cost Computation of Net Gain or Loss Recognition of Additional Pension Liability Other Postemployment Benefits Other Postemployment Benefits Beneficiary Retired employee (some Retired employee, residual benefit to spouse, and surviving spouse) dependents Benefits Defined, fixed dollar Not limited, paid as amount, paid monthly used, varies geographically Funding Funding legally required Usually not funded and tax deductible because not legally required and not tax deductible OPEB Expense 1. Service cost 2. Interest cost 3. Expected return on plan assets 4. Amortization of unrecognized prior service cost 5. Gain or loss 6. Recognition of the obligation or asset existing at the date of the initial adoption of the statement Illustration of Accounting for OPEBS December 31, 2004: Pension Expense 400,000 Prepaid/Accrued Pension Cost 15,000 Cash 415,000 Carlisle Company funds $415,000 in 2004, $425,000 in 2005, and $440,000 in 2006. The expected and actual return is is 11%. December 31, 2005: