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Article: Provocative pension accounting: standard setters worldwide should model changes in pension accounting on a novel new approach the U.K.'s accounting standards board has taken.(Opinion)
- Article from:
- Strategic Finance
- Article date:
- August 1, 2003
- Author:
CopyrightCOPYRIGHT 2003 Institute of Management Accountants. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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As U.S. defined-benefit pension plans have lost money, many corporate plan sponsors have reported gains. They've done so completely in accord with current U.S. accounting standards. But a bold new U.K. standard starkly departs from--and greatly improves--complicated U.S. pension accounting.
The U.K.'s Financial Reporting Standard (FRS) No. 17, "Retirement Benefits," issued by the Accounting Standards Board of the U.K. in November 2000 and amended in November 2002, improves both the balance sheet and income statement treatment of retirement obligations. It also enhances earnings quality, classification of pension expense components, and definition of a balance ...