Pension Accounting at At&T

The Financial Accounting Standard Board Standard No. 87 supersedes all other methods of accounting for pensions. However, many accountants think that this statement will also be superseded eventually since it contains several theoretical inconsistencies. The purpose of this article is first to apply agency theory to the determination of pension benefits, in order to show that pension costs represent a sharing of future cost savings in the employee-employer relationship. Some implications of the derived model are then applied to the provisions of SFAS No. 87. This model can thus be used to develop a consistent economic theory for pension accounting.

Download Full-text

Pension Accounting Choice in Germany: Pension Discount Rate and Actuarial Gains and Losses

SSRN Electronic Journal ◽

10.2139/ssrn.1586117 ◽

2010 ◽

Cited By ~ 2

Author(s):

Christian Stadler

Keyword(s):

Discount Rate ◽

Accounting Choice ◽

Pension Accounting ◽

Gains And Losses

Download Full-text

The development of actuarial-based pension accounting at the Bell System, 1913—40

Accounting History ◽

10.1177/1032373207076036 ◽

2007 ◽

Vol 12 (2) ◽

pp. 205-234 ◽

Cited By ~ 8

Author(s):

Nandini Chandar ◽

Paul J. Miranti

Keyword(s):

Pension Accounting

Download Full-text

Predicting cash flows related to defined benefit plan contributions

Journal of Pension Economics and Finance ◽

10.1017/s1474747209990333 ◽

2010 ◽

Vol 9 (4) ◽

pp. 505-532 ◽

Cited By ~ 2

Author(s):

THOMAS D. DOWDELL ◽

BONNIE K. KLAMM ◽

ROXANNE M. SPINDLE

Keyword(s):

Cash Flow ◽

Financial Statements ◽

Cash Flows ◽

Pension Plans ◽

Defined Benefit ◽

Pension Accounting ◽

Accounting Standard ◽

Benefit Plan ◽

Accounting Rules ◽

Pension Liabilities

AbstractFuture contributions to defined benefit pension plans are a significant cash flow item that can be difficult to estimate. Funding ratios – pension assets relative to pension liabilities – have long been considered important for estimating cash flows needed for current and future pension contributions (Ballester et al., 1998). However, US GAAP or IFRS funding ratios that companies report in their financial statements may differ from funding ratios used by pension regulators. These regulatory funding ratios may be more useful for predicting future contributions.We investigate whether US regulatory and GAAP funding ratios are different and whether regulatory funding ratios provide useful information for predicting future contributions. For 3,877 firm years from 1995 through 2002, we observe that regulatory and GAAP funding ratios differ by more than 5% for 73% of our sample. We also find that predictions of future contributions are improved by using regulatory funding ratios in addition to GAAP funding ratios. Our results are relevant to accounting standard setters' ongoing review of pension accounting rules.

Download Full-text