Examples of pension in the following topics:
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Overview of Pension Accounting
- Due to the nature of pension plans, accounting for them is rather complicated.
- The employer (sponsor) reports pension expense on the income statement, and a pension liability which is the sum of two accounts, accrued/prepaid pension cost and additional liability, and an intangible asset-deferred pension cost (if required).
- In addition to reporting the pension expense on the income statement companies should disclose the following information about the pension plan:
- The amounts for the components of pension expense for the period
- Summarize how a company reports their pension plan on their financials statements
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What Goes on the Balances Sheet and What Goes in the Notes
- For example, companies that pay pension plan benefits require additional footnote disclosure that provide the user with additional details on pension costs and the assets used to fund it.
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Types of Long-Lived Assets
- Other types of investments include investments in special funds-- e.g. sinking funds or pension funds-- and different forms of insurance.
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Defining Liabilities
- Long-term liabilities have maturity dates that extend past one year, such as bonds payable and pension obligations.
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Classifying Liabilities
- These usually include issued long-term bonds, notes payables, long-term leases, pension obligations, and long-term product warranties.
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Equity Method
- An alternative, which is usually employed by large private investors and pension funds, is to hold shares directly.