- CFA Exams
- CFA Level I Exam
- Study Session 5. Financial Reporting and Analysis (1)
- Reading 14. Employee Compensation: Post-Employment and Share-Based
- Subject 3. Analysis of Pension Plan Disclosures
CFA Practice Question
Which of the following approaches is used when the accumulated benefit obligation exceeds the fair value of the plan assets?
A. Corridor approach.
B. Minimum liability.
C. Amortization of excess ABO.
User Contributed Comments 4
| User | Comment |
|---|---|
| Andrewua | Why? |
| StJohnDale | Corridor approach - If actuarial gain / loss exceeds ( greater of 1) 10 % of PBO or 2) 10 % Fair Value of Assets), such excess must be recognised in income statement over hte remaining useful lives of the employee's |
| kvy_madhu | Is this an error ?? |
| kvy_madhu | Is this an error ?? |