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Types of pension schemes: 2 Lernen beginnen
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Defined contribution, | Defined benefits. CB
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Defined contribution pension scheme definition. 3 Lernen beginnen
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An entity pays fixed contributions | and will have NO legal or constructive obligation to pay further contributions | if the fund does not hold sufficient assets to pay all employee benefits.
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Defined benefit pension scheme. Lernen beginnen
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A pension scheme that is not a defined contribution scheme, so constructive or legal obligation exist.
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For a defined contribution scheme, contributions payable are recognised as ... in... 2 Lernen beginnen
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IAS 19 requires that plan assets are measured at their ... at the at the end of the reporting period. IAS 19: Employee benefits. Lernen beginnen
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IAS 19 requires that plan liabilities are measured on ... basis. Lernen beginnen
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IAS 19 requires that plan liabilities are measured on an actuarial basis and are discounted to ... at end of the reporting period. Lernen beginnen
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Where there is a net asset, the asset ceiling applies. This restricts... Lernen beginnen
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the VALUE OF THE NET ASSETS reported to the extent that it is regarded as RECOVERABLE. 'value of the net assets'
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Current service cost definition. 2cz Lernen beginnen
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'increase in the PV of the defined benefit obligation | resulting from employee service in the current period' This is part of the service cost component.
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Past service cost definition. 3cz Lernen beginnen
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change in PV of the defined benefit obligation| for employee service in prior periods| resulting from a plan amendment or curtailment in a current period This is part of the service cost component.
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Curtailment arises when... Lernen beginnen
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when there is a SIGNIFICANT reduction in the number of employees covered by a plan. Any gain or loss on curtailment is part of the service cost component.
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A settlement arises when... Lernen beginnen
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when an entity enters into a transaction | to TERMINATE all or part of the benefits | due to one or more employees under a plan. This is part of the service cost component.
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The change in measurement in both the plan obligation and the plan assets | due to the passage of time. plan obligation | plan assets
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NIC is largely calculated by... 3cz Lernen beginnen
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by applying a single discount rate | to the net difference* | between the defined benefit obligation and the FV of the plan assets.
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NIC is charged (or credited) to... IAS 19 Employee benefits Lernen beginnen
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The remeasurement component arises due to... Lernen beginnen
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due to differences between the ACCOUNTING ESTIMATES made when for the defined benefit plan, and what has actually happened.
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The remeasurement component is taken to... Lernen beginnen
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Items of Defined Benefit pension plan are recognised in three statements: 3 Lernen beginnen
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Items of Defined Benefit pension plan recognised in PoL: 2 Lernen beginnen
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Service cost component | Net interest component.
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Item of Defined Benefit pension plan recognised in OCI: Lernen beginnen
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Items of Defined Benefit pension plan recognised in SoFP: 3 Lernen beginnen
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Plan obligation, | Plan assets, | Asset ceiling*. *If a company has an overall pension asset on its SoFP then the asset can only be recognised up to the level of the asset ceiling. Asset ceiling is the PV of any future cash savings of not having to contribute to the scheme as it is in surplus.
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Treatment of other long-term employee benefits: 2cz Lernen beginnen
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Account for in similar way to defined benefit pension plans | - spread cost over service period.
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Treatment of short-term employee benefits. 2cz Lernen beginnen
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Normal accrual accounting. | Cumulating or non-cumulating.
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Treatment of termination benefits. 2cz Lernen beginnen
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Recognise when an plan Obligation | or when related Restructuring costs are recognised. OR
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Any gain or loss on CURTAILMENT is part of... Lernen beginnen
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of the service cost component. e.g. 600 (plan obligation) - 10% = 540 | Gain is 60.
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SCC is charged to PoL and is comprised of 3elements: 3 Lernen beginnen
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Current SC, | Past SC, | any PoL on settlement.
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