Fair Value of Plan Assets (FVPA)

Beginning Balance Benefits Paid to retirees

Actual Return on plan assets Settlement Price of benefit
obligation (SP)
Contribution to the plan

Ending Balance

Projected Benefit Obligation (PBO)

Benefits Paid to retirees
Present value of benefit
obligation settled (PVOS)
Beginning Balance
Past Service Cost
Current Service Cost
Interest Expense

Ending Balance

Notes:

1. Composition of Employee Benefit Expense:

a. Past Service Cost xxx
b. Current Service Cost xxx
c. (1.1) Settlement Gain or Settlement Loss. (xxx) xxx
d. (1.2) Interest Expense xxx
e. (1.3) Interest Income (xxx)
f. (1.4) Interest on Beginning Balance of Asset Ceiling xxx

2. Remeasurements:
a. (2.1) Gain/Loss in Projected Benefit Obligation (xxx) xxx
b. (2.2) Gain/Loss between Actual Return and Interest Income (xxx) xxx
c. (2.3) Gain/Loss on the change in the effect of the asset ceiling (xxx) xxx

3. Employee Benefit Expense +/- Remeasurements = Net defined benefit cost

4. If PBO, Ending > FVPA, Ending = Accrued Cost
If PBO, Ending < FVPA, Ending = Prepaid Cost

1.1 If PVOS > SP, there is gain

If PVOS < SP, there is loss

1.2 PBO, Beginning x Discount Rate

1.3 FVPA, Beginning x Discount Rate

1.4 Asset Ceiling, Beginning x Discount Rate

2.1If PBO increases, there is loss
If PBO decreases, there is gain

2.2 If Actual Return < Interest Income, there is loss

If Actual Return > Interest Income, there is gain

2.3. If there is an increase in the asset ceiling, deduct first the interest on the beginning balance
of the asset ceiling to the total amount of increase and the remainder will be a loss.
If there is a decrease in the asset ceiling, deduct first the interest on the beginning balance
of the asset ceiling to the total amount of decrease and the remainder will be a gain.