IAS 19 vs.

FAS158, 132R, 87, etc.

versus

The scope is broad and includes wages, vacation or holiday pay, bonus,

termination benefits, etc. as well as retirement plans

Covers full-time, part-time, temporary staff and directors

If it is defined benefit and information is available, account and disclose proportionate share as though it were defined benefit plan of reporting entity

If information is not available, account for it as though it were a defined contribution plan

An employer participating in a multiemployer plan shall recognize as net pension cost the required contribution for the period and shall recognize as a liability any contributions due and unpaid.

IFRS US GAAP Comment

Defined benefit obligation

PBO for pensionAPBO for other (health)

Similar: estimated based on salary at retirement

Plan assets Plan assets Similar

Expected return Expected return Similar

Discount rate Discount rate Similar

Current service cost Service cost Essentially the same

Interest cost Interest cost Essentially the same

Ceiling on defined benefit asset

n/a Nothing comparable in US GAAP

Statement of recognised income and expense (SORIE)

Statement of comprehensive income

Reports portion of changes in net asset/liability not yet recognized in net income

Two optionsRoughly equivalent to pre-

FAS158 GAAP (Assets, PBO, unrecognized amounts netted) with minimum liability or maximum on asset

amountRoughly equivalent to post-

FAS158 Put unrecognized

amounts in equity Report net of plan assets

& obligation (in asset or liability section)

Net presentation: Plan assets and projected benefit obligation are nettedAssets > liability =

noncurrentLiability > assets =

current and noncurrent classification

Unrecognized gains & losses in AOCI

No minimum liability requirement

Current service costInterest costExpected return and any

reimbursement rightsActuarial gains and losses

recognizedPast service cost

recognizedEffect of curtailments or

settlementsEffect of any limit on

balance sheet asset

Current service costInterest costExpected returnAmortization of actuarial

gain or lossAmortization of prior

service cost (and any transition amount)

Effect of curtailments or settlements

Very extensiveMovement in defined

benefit obligationMovement in fair value of

assetsAmounts charged to

operating profitsAssumptionsLots more

Very extensiveReconciliation of PBOReconciliation of plan

assetsAmount recognized in

expenseAmount recognized on

statement of comprehensive income

AssumptionsLots more

Measured as the change in liability resulting from plan amendment

Recognized on straight-line basis over the average period until the benefits become vested

If immediately vested, recognize past service cost immediately

Prior service cost = the cost of retroactive benefits granted in a plan amendmentCould be recognized

immediately but recognition over average remaining service live at amendment is permitted using

Years of service method Straight-line method

The rate shall be determined by reference to market yields at the balance sheet date on high quality corporate bonds. Exception for countries

where there is no deep market in such bonds – then look to government bond rates

The currency and term shall be consistent with the currency and estimated term of the post-employment benefit obligations.

Assumed discount rates shall reflect the rates at which the pension benefits could be effectively settled. Look to rates implicit in

current prices of annuity contracts including information published by the Pension Benefit Guaranty Corporation.

Look to rates of return on high-quality fixed-income investments currently available and expected to be available during the period to maturity of the pension benefits.

The expected return on plan assets is based on market expectations, at the beginning of the period, for returns over the entire life of the related obligation.

The expected return on plan assets reflects changes in the fair value of plan assets held during the period as a result of actual contributions paid into the fund and actual benefits paid out of the fund.

The expected return on plan assets shall be determined based on the expected long-term rate of return on plan assets and the market-related value of plan assets. The market-related value of

plan assets shall be either fair value or a calculated value that recognizes changes in fair value in a systematic and rational manner over not more than five years

The manner of determining market-related value shall be applied consistently from year to year for each asset class.

Recognize only if entity is demonstrably committed to either: Terminate employment of

an employee or group of employees before the normal retirement date; or

Provide termination benefits as a result of an offer made in order to encourage voluntary redundancy (estimate number who will accept offer)

Contractual termination benefits are recognized when it is probable that employees will be entitled to benefits and the amount can be reasonably estimated.

Special voluntary termination benefits are recognized when the employees accept the offer and the amount can be reasonably estimated.

An entity shall recognize the expected cost of short-term employee benefits in the form of compensated absences as follows:

1. Accumulating compensated absences -- when the employees render service that increases their entitlement to future compensated absences

2. Non-accumulating compensated absences -- when the absences occur

A liability should be accrued if all of the following conditions are met:

1.Obligation is attributable to past services

2.Rights vest or can be accumulated

3.Payment is probable4.Amount can be

reasonably estimated