Funded Status of Pension Plan

  • Creator
    Topic
  • February 21, 2018 at 10:59 pm #1717805
    OnToTheNextOne
    Participant

    In regards to a Becker Sim asking for the funded status of a pension plan with the following Data:

    View post on imgur.com

    The answer for Year 4 is:

    View post on imgur.com

    I believed that the funded status is calculated by the FV of plan assets – PBO at the beginning of the year, yet Becker calculated the data at 12/31/Y4.

    Is this wrong?

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  • February 21, 2018 at 11:01 pm #1717807
    OnToTheNextOne
    Participant

    Am I confusing using the data for 12/31/Y3 to calculate net periodic pension cost for funded status as well?

    February 22, 2018 at 9:17 am #1717891
    mskcle
    Participant

    Funded status is based of the end of the year PBO and FV of plan assets. You are correct using the 12/31/Y3 info to calculate net periodic pension cost and all of the calculations because they are based on the 12/31/Y3 info.

    February 22, 2018 at 4:28 pm #1718117
    OnToTheNextOne
    Participant

    Thanks man that what I figured but I needed a second opinion

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