Pensions

Question 1

Projected Benefit Obligation (PBO)

Answer 1

Reflects future compensation levels

Question 2

Accumulated Benefit Obligation

Answer 2

PV of Pension Benefits accrued based on present compensation levels

Question 3

Pension Expense Calculation

Answer 3

Service Cost
\+ Interst
- Actual Return on Plan Assets
\+ Unexpected Loss (Gains)
\+ Amort. of Prior Service Cost
= Pension Expense

Question 4

Service Cost

Answer 4

As employees work, the PBO increases

Question 5

Interest

Answer 5

Beginning PBO x Interest Rate

Increase in PBO due to time

Question 6

Actual Return on Plan Assets

Answer 6

Ending Value - Beginning Value net of contributions

Question 7

Fair Value of Plan Assets - PBO

Answer 7

Overfunded = Non-current Asset
Underfunded = Non-current Liability
Gains/Losses go to OCI
- Net of Tax

Question 8

Financial Statement Disclosures

Answer 8

Pension Funding Policies
Types of Assets Held
5 year benefits to be paid
5 year benefits in aggregate thereafter
Estimated pension contribution for next period

Question 9

Vested Benefits

Answer 9

Owed to employee regardless of continuance of employment via the Full Eligibility Date