Pension cost
Pension cost is an expense or other accounting amount arising from an employer’s employee benefit arrangements. Its calculation and presentation depend on the type of plan and applicable IAS 19 requirements; defined contribution and defined benefit arrangements differ.
Worked example
An entity records contributions for a defined contribution plan and evaluates the actuarial valuation for a defined benefit plan.
Common mistake
A cash contribution paid in a year is not automatically the same as the expense for a defined benefit plan.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | AAA (INT) | Supporting | September 2026–June 2027 |