IASB proposes narrow amendments to pension accounting standards

By Ken Tysiac

The International Accounting Standards Board on Thursday proposed narrow-scope amendments to pension accounting standards—a move designed to provide better information to investors and reduce diversity in practice.

The proposed changes are included in an exposure draft, Remeasurement on a Plan Amendment, Curtailment or Settlement/Availability of a Refund from a Defined Benefit Plan.

When a defined benefit plan is amended, curtailed, or settled during a reporting period, the entity is currently required to update the assumptions about its obligation and the fair value of its plan assets in order to calculate costs related to these changes.

Under proposed amendments to IAS 19, Employee Benefits, the entity would be required to use the updated information to determine current service cost and net interest for the period followed by these changes.

Availability of a refund

According to IAS 19, a surplus is determined as the fair value of the plan asset minus the present value of the defined benefit obligation. The net defined benefit asset to be recognized is the lower of the surplus and the asset ceiling.

Proposed changes to IFRIC 14 IAS 19—The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction address how the powers of other parties such as the trustees of a plan affect an entity’s right to a refund of the surplus from a plan.

The proposal also would address the asset ceiling’s interaction with the past service cost or a gain or loss on settlement.

Comments on the proposal are due Oct. 19 and can be submitted at the IFRS website.

Ken Tysiac ( ktysiac@aicpa.org ) is a JofA editorial director.


Year-end tax planning and what’s new for 2016

Practitioners need to consider several tax planning opportunities to review with their clients before the end of the year. This report offers strategies for individuals and businesses, as well as recent federal tax law changes affecting this year’s tax returns.


News quiz: Retirement planning, tax practice, and fraud risk

Recent reports focused on a survey that gauges the worries about retirement among CPA financial planners’ clients, a suit that affects tax practitioners, and a guide that offers advice on fraud risk. See how much you know with this short quiz.


Bolster your data defenses

As you weather the dog days of summer, it’s a good time to make sure your cybersecurity structure can stand up to the heat of external and internal threats. Here are six steps to help shore up your systems.