- CFA Exams
- CFA Level I Exam
- Topic 3. Financial Statement Analysis
- Learning Module 12. Employee Compensation: Post-Employment and Share-Based
- Subject 2. Accounting for Defined Benefit Plans
CFA Practice Question
Participant contributions ______ PBO and ______ plan assets.
A. don't change, increase.
B. decrease, increase.
C. decrease, decrease.
Explanation: Participant contributions don't change PBO and increase plan assets.
User Contributed Comments 1
| User | Comment |
|---|---|
| keit | Participant contributions have no impact on PBO. The promised liability is unchanged only the cost of providing it is reduced by participant contributions. NPPC is lower and plan assets are higher but PBO is the same. |