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Employee Benefits - Pensions

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Employee Benefits - Pensions

How can you tell if the difference in the defined benefit and FV of assets is a Re-measurement gain/loss?

I usually able to work out the balancing figure but which is the difference between the actuary figure and the actual plan figure.

The issue is i find it difficult to grasp whether that balancing figure is a gain/loss.

November 10th 2015 AN ACCA USER 290 Points

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Bfwd balance
+Interest
+Cash paid in
-Cash paid out


x

BALANCING FIGURE


Closing balance (as measured by the Actuary)

If "x" is less than the Closing Balance, then the Balancing Figure is positive and there is a remeasurement gain
If "x" is more than the Closing Balance, then the Balancing Figure is negative and there is a remeasurement loss.

The former is because the actuary is telling you that your plan assets are worth more than you have calculated, whereas in the latter, s/he is telling you its worth less than you have calculated.

November 13th 2015 AN ACCA USER 860 Points
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