【導(dǎo)讀】employeeservices.providesbenefits.1.Coveratleast70%ofemployees.pensatedemployees.atrust.service.employment.contract.investmentfund.performance.benefits.service,level,andage.performance.

　　

【正文】 76 ) (4 0) Serv ic e c os t ( 155 ) 15 5 ( 155 ) I nt eres t c os t , 6% ( 64 ) 64 ( 64 ) Ex pec t ed ret urn on as s et s 54 ( 54 ) 54 Gain on as s et s 4 .5 ( 4 .5 ) 4 .5 Am ort iz at ion of : Prior s erv ic e c os t ( 5 ) 5 N et gain 1 ( 1 ) C as h f unding 48 ( 48 ) 48 Los s on PB O (1 2 ) 12 (1 2 ) R et iree benefit s paid 71 ( 71 ) Balance, D ec . 31, 2020 ( 800 ) 635 .5 55 (5 8 .5) 169 ( 1 6 4 .5 ) 1763 Learning Objectives Describe the nature of postretirement benefit plans other than pensions and identify the similarities and differences in accounting for those plans and pensions. 1764 Postretirement Benefit Plan Enpass all types of retiree health and welfare benefits including . . . ? Medical coverage, ? Dental coverage, ? Life insurance, ? Group legal services, and ? Other benefits. 1765 Postretirement Health Benefits and Pension Benefits Compared Pension Plan Benefits Usually based on years of service. Identical payments for same years of service. Cost of plan usually paid by employer. Vesting usually required. Postretirement Health Benefits Typically unrelated to service. Payments vary depending on medical needs. Company and retiree share the costs. True vesting does not exist. 1766 The Net Cost of Benefits Estimated medical costs in each year of retirement Estimated cost of benefits Retiree share of cost Medicare payments Less: Equals: 1767 The Net Cost of Benefits Estimating postretirement health care benefits is like estimating pension benefits, but there are some additional assumptions required: ?Current cost of providing health care benefits (per capita claims cost). ?Demographic characteristics of participants. ?Benefits provided by Medicare. ?Expected health care cost trend rate. 1768 Learning Objectives Explain how the obligation for postretirement benefits is measured and how the obligation changes. 1769 Postretirement Benefit Obligation Accumulated (APBO) The portion of the EPBO attributed to employee service to date. Expected (EPBO) The actuary’s estimate of the total postretirement benefits (at their discounted present value) expected to be received by plan participants. 1770 Measuring the Obligation On December 31, our actuary estimates that the present value of the expected benefit obligation for your postretirement health care costs is $10,250. You have worked for the pany for 6 years and are expected to have 30 years of service at retirement. The actuary uses a 6% discount rate. Let’s calculate the APBO. 1771 Measuring the Obligation EPBO Fraction attributed to service to date APBO = $10,250 6 30 = $2,050 APBO at the beginning of the year. 1772 Measuring the Obligation EPBO Beginning of Year (1 + Discount Rate) = EPBO End of Year To calculate the APBO at the end of the year, we start by determining the ending EPBO. $10,250 = $10,865 APBO End of Year $10,865 7 30 = $2,535 1773 Measuring the Obligation APBO may also be calculated like this: A P B O b e g i n n i n g o f t h e y e a r 2 , 0 5 0$ I n t e r e s t c o s t ( $ 2 , 0 5 0 6 % ) 123 S e r v i c e c o s t ( $ 1 0 , 8 6 5 1 / 3 0 ) 362 A P B O e n d o f t h e y e a r 2 , 5 3 5$ The APBO increases because of interest and the service fraction (service cost). 1774 Attribution The process of assigning the cost of benefits to the years during which those benefits are assumed to be earned by employees, the date of hire to the ―full eligibility date‖. 1775 Measuring Service Cost Pension Benefits Other Postretirement Benefits Employees earn benefits gradually. No benefits until full eligibility. 0% 100% 1776 Learning Objectives Determine the ponents of postretirement benefit expense. 1777 Postretirement Benefit Expense C o m p o n e n t Po s t re t i re m e n t Be n e f i t Ex p e n s eS e r v i c e C o s tP o r t i o n o f t h e E P B O a t t r i b u t e d t o t h e c u r r e n t p e r i o d .I n t e r e s t C o s tI n c r e a s e i n A P B O d u e t o t h e p a s s a g e o f t i m e .E x p e c t e d R e t u r n o n P l a n A s s e t sE a r n i n g s o n p l a n i n v e s t m e n t s , i f p l a n i s f u n d e d .P r i o r S e r v i c e C o s tA m o r t i z a t i o n o f c o m p e n s a t i o n c o s t f r o m a m e n d i n g t h e p l a n . O f t e n a n e g a t i v e a m o u n t .L o s s e s o r G a i n sA m o r t i z a t i o n o f u n e x p e c t e d c h a n g e s i n e i t h e r t h e o b l i g a t i o n o r p l a n a s s e t s .1778 Appendix 17 Service Method of Allocating Prior Service Cost 1779 The Service Method The allocation approach that reflects the declining service pattern of employees is called the service method. The method requires that the total number of service years for all employees be calculated. This calculation is usually done by the actuary. Assume Matrix, Inc. has 2,000 employees and the pany’s actuary determined that the total number of service years of these employees is 30,000. We would calculate the following amortization fraction: 30,000 2,000 = 15 average service years 1780 End of Chapter 1