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Improving the Disclosure Basis of Pension Accounting
Author(s) -
Chang ChunChia Amy,
Duke Joanne C.,
Hsieh SuJane
Publication year - 2014
Publication title -
journal of corporate accounting and finance
Language(s) - English
Resource type - Journals
eISSN - 1097-0053
pISSN - 1044-8136
DOI - 10.1002/jcaf.21957
Subject(s) - pension , accounting , audit , business , financial accounting , financial statement , accounting information system , accounting standard , actuarial science , mark to market accounting , service (business) , reliability (semiconductor) , finance , power (physics) , physics , quantum mechanics , marketing
In response to criticisms of U.S. pension accounting standards, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards 158 in 2006. However, the authors say more needs to be done, and they propose a gross recognition approach in which gross pension assets and liabilities are reported and prior service costs and actuarial gains/losses are recognized as they are incurred. An implication is that auditors should apply the same auditing standards to disclosed pension information as to recognized information, and regulators should consider moving pension information to the statements to improve reliability.