In: Accounting
find and share a peer-reviewed publication dated no later than January 1, 2017 regarding accounting for post-retirement benefits. Provide complete reference list information, a brief summary of the publication and a copy of the publication.
Post-retirement benefit expense refers to the cost of pension recognizable for the period. There are several components in computing for post-retirement benefit expense, but they depend on the type of plan established by your company. These plans can either be a defined contribution plan or a defined benefit plan.
ACCOUNTING STANDARDS UPDATE NO. 2017-07, COMPENSATION—RETIREMENT BENEFITS (TOPIC 715): IMPROVING THE PRESENTATION OF NET PERIODIC PENSION COST AND NET PERIODIC POSTRETIREMENT BENEFIT COST
Overview
On March 10, 2017, the FASB issued Accounting Standards Update No.
2017-07, Compensation—Retirement Benefits (Topic 715):
Improving the Presentation of Net Periodic Pension Cost and Net
Periodic Postretirement Benefit Cost. The new guidance
improves the presentation of net periodic pension cost and net
period postretirement benefit cost.
Specifically, the amendments in the Update:
Effective Dates
The amendments in Update 2017-07 are effective for public business
entities for annual periods beginning after December 15, 2017,
including interim periods within those annual periods. For other
entities, the amendments in this Update are effective for annual
periods beginning after December 15, 2018 and interim periods
within annual periods beginning after December 15, 2019. Early
adoption is permitted as of the beginning of an annual period for
which financial statements (interim or annual) have not been issued
or made available for issuance. That is, early adoption should be
within the first interim period if an employer issues interim
financial statements. Disclosures of the nature of and reason for
the change in accounting principle are required in the first
interim and annual periods of adoption.
The amendments in Update 2017-07 should be applied retrospectively
for the presentation of the service cost component and the other
components of net periodic pension cost and net periodic
postretirement benefit cost in the income statement and
prospectively, on and after the effective date, for the
capitalization of the service cost component of net periodic
pension cost and net periodic postretirement benefit in assets. The
amendments allow a practical expedient that permits an employer to
use the amounts disclosed in its pension and other postretirement
benefit plan note for the prior comparative periods as the
estimation basis for applying the retrospective presentation
requirements. Disclosure that the practical expedient was used is
required.