20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for December 2024 exams.
Get your discount code >>

Question about employee benefit

This topic has 2 replies, 2 voices, and was last updated 9 years ago by Ruby.

Viewing 3 posts - 1 through 3 (of 3 total)

Author
Posts
May 4, 2015 at 5:06 pm #244041
Tianxiao
Member
- Topics: 12
- Replies: 6
Hi,
” After conculting with the actuaries, the company decide to reduce its contributions for the year to $45 million.”
Why this statement would result to an increase of current liability by $45 million ? I thought contribution received only causes an increases in plan assets.
May 5, 2015 at 3:54 am #244096
Tianxiao
Member
- Topics: 12
- Replies: 6
Anyone?
May 5, 2015 at 5:38 pm #244212
Ruby
Member
- Topics: 4
- Replies: 46
Liability on defined benefit plan =
opening net assets/deficit
+ finance cost
+ Current year service cost
+ past service cost
– Contribution paid to scheme.
Therefore, if you reduce the contribution paid, your liability will increase.
Author
Posts

Viewing 3 posts - 1 through 3 (of 3 total)

You must be logged in to reply to this topic.