John Wiley Accountants Handbook Volume 2_8 pdf

36.8 SOURCES AND SUGGESTED REFERENCES American Academy of Actuaries, “An Actuary’s Guide to Compliance with Statement of Financial Accounting Standards No. 87.” AAA, Washington, DC, 1986. ______, “Actuarial Compliance Guideline for Statement of Financial Accounting Standards No. 88.” Actuarial Standards Board, Washington, DC, 1989. Accounting Principles Board, “Accounting for the Cost of Pension Plans,” APB Opinion No. 8. AICPA, New York, 1966. ______, “Accounting Changes,” APB Opinion No. 20. AICPA, New York, 1971. ______, “Reporting the Results of Operation—Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions,” APB Opinion No. 30. AICPA, New York, 1973. Accounting Standards Executive Committee, “Accounting for and Reporting of Postretirement Medical Benefit (401(h)) Features of Defined Benefit Pension Plans,” Statement of Position 99-2. AICPA, New York, 1999. Financial Accounting Standards Board, “A Guide to Implementation of Statement 87 on Employers’ Accounting for Pensions: Questions and Answers.” FASB, Stamford, CT, 1986. ______, “A Guide to Implementation of Statement 88: Questions and Answers.” FASB, Norwalk, CT, 1988. 36 • 48 PENSION PLANS AND OTHER POSTRETIREMENT AND POSTEMPLOYMENT BENEFITS Reconciliation of Funded Status 1. Actuarial Liability a. Disabled Participants ($12,000,000) b. Active Participants ($20,000,000) c. Total ($32,000,000) 2. Fair Value of Assets $0 3. Funded Status ($32,000,000) 4. Unrecognized Amount at Transition* $0 5. Unrecognized Net Loss/(Gain) $6,000,000 6. Unrecognized Prior Service Cost $0 7. (Accrued)/Prepaid Postemployment Benefit Cost at Year End ($26,000,000) *SFAS No. 112 did not allow delayed recognition of the transition obligation. Change in (Accrued)/Prepaid Postemployment Benefit Cost 1. (Accrued)/Prepaid Postemployment Benefit Cost at Prior Year End ($24,400,000) 2. Expense During Year* a. Service Cost $2,200,000 b. Interest Cost $2,800,000 c. Amortization of Loss/(Gain) $600,000 d. Total Expense $5,600,000 3. Payouts During Year** $4,000,000 4. (Accrued)/Prepaid Postemployment Benefit Cost at Current Year End ($26,000,000) *Since SFAS No. 43 applies to this plan, the annual expense is explicitly calculated as the sum of the service cost, interest cost, and amortization of unrecognized actuarial losses. Were this a SFAS No. 5 plan, the annual expense would equal the change in the actuarial reserve, adjusted for benefit payments made during the year. ** Since the plan is unfunded, benefit payments are treated as employer contributions. Exhibit 36.11 Illustration of SFAS No. 112 accounting. ______, “Accounting and Reporting by Defined Benefit Pension Plans,” Statement of Financial Accounting Stan- dards No. 35. FASB, Stamford, CT, 1980. ______, “Employers’ Accounting for Pensions,” Statement of Financial Accounting Standards No. 87. FASB, Stamford, CT, 1985. ______, “Employers’ Accounting for Settlements and Curtailments of Deferred Benefit Pension Plans and for Termination Benefits,” Statement of Financial Accounting Standards No. 88. FASB, Stamford, CT, 1985. ______, “Employers’ Accounting for Postretirement Benefits Other than Pension,” Statement of Financial Ac- counting Standards No. 106. FASB, Norwalk, CT, 1990. ______, “Accounting for Income Taxes,” Statement of Financial Accounting Standards No. 109. FASB, Nor- walk, CT, 1992. ______, “Reporting by Defined Benefit Pension Plans of Investment Contracts,” Statement of Financial Ac- counting Standards No. 110. FASB, Norwalk, CT, 1992. ______, “Employers’ Accounting for Postemployment Benefits,” Statement of Financial Accounting Standards No. 112. FASB, Norwalk, CT, 1992. ______, “Reporting Comprehensive Income,” Statement of Financial Accounting Standards No. 130. FASB, Norwalk, CT, 1997. ______, “Employers’ Disclosures about Pensions and Other Postretirement Benefits,” Statement of Financial Ac- counting Standards No. 132. FASB, Norwalk, CT, 1998. ______, “Business Combinations,” Statement of Financial Accounting Standards No. 141. FASB, Norwalk, CT, 2001. Lorenson, Leonard, and Rosenfield, Paul, “Vested Benefits—A Company’s Only Pension Liability,” Journal of Accountancy, October 1983. Munnell, Alicia H., Economics of Private Pensions. The Brookings Institution, Washington, DC, 1982. 36.8 SOURCES AND SUGGESTED REFERENCES 36 • 49 . Federal Income Taxes 28 (iv) Accounting by Employer for Earnings per Share 28 (v) Illustration of a Fixed Award 28 (b) Variable Award—Stock Appreciation Right 28 (i) Definition 28 (ii) Accounting. to Performance-Based Vesting 27 37.5 ILLUSTRATIONS OF ACCOUNTING UNDER APB OPINION NO. 25 27 (a) Fixed Award 28 (i) Definition 28 (ii) Accounting by Employer for Compensation Expense 28 (iii) Accounting. Fixed Awards 22 (ii) Allocation of Compensation Cost Related to Variable Awards 22 (e) Canceled or Forfeited Rights 22 (f) Accounting for Income Taxes under APB Opinion No. 25 23 (g) Other APB