Question

Marko Inc. provides the following information related to its post-retirement health care benefits for the year 2018 (amounts in thousands of Canadian dollars): Defined post-retirement benefit obligation at January 1, 2018 - $100,000 Plan assets, January 1, 2018 - 40,000 Actual return on plan assets, 2018 - 3,000 Discount rate- 10% Service cost,2018 - 57,000

Plan funding during 2018 - 22,000

Payments from plan to retirees during 2018 - 6,000 Actuarial loss on defined post-retirement benefit obligation, 2018 (end of year)- 31,000

Marko Inc. follows IFRS.

REQUIRED:

(a) Calculate the post-retirement benefit expense for 2018. (b) Calculate the post-retirement benefit remeasurement gain or loss- other comprehensive income (OCI) for 2018. (c) Determine the December 31, 2018 balance of the plan assets, the defined post-retirement benefit obligation, and the plan surplus or deficit. (d) Determine the balance of the net post-retirement benefit liability/asset account on the December 31, 2018 statement of financial position. (e) Reconcile the plan surplus or deficit with the amount reported on the statement of financial position at December 31, 2018.

Answer 1

(a) Calculate the post-retirement benefit expense for 2018.

(b) Calculate the post-retirement benefit remeasurement gain or loss- other comprehensive income (OCI) for 2018.

(c) Determine the December 31, 2018 balance of the plan assets, the defined post-retirement benefit obligation, and the plan surplus or deficit.

(d) Determine the balance of the net post-retirement benefit liability/asset account on the December 31, 2018 statement of financial position.

(e) Reconcile the plan surplus or deficit with the amount reported on the statement of financial position at December 31, 2018.

Refer to the below images for the above asked questions, in a detailed way of solution.