Acc 541 Reporting Paper
The new company that has been acquired consists of two segments, which you have already expressed a dislike to and two different pension plans. Expelling the two segments from this new company, which as been suggested, may be not as easy as it we may think. This company also has two different pension plans we must look at to make sure the required reporting for defined contribution, defined benefit and other postretirement plans are in compliance.
Required Reporting’s for Pension Plans
There are two frequently used pension plans which are defined benefit and contribution plans. Defined contribution plan consist of the employer’s promise to contribute a certain amount into the plan every pay period (Schroeder, Clark, & Cathey, 2005). For example, the company will contribute say 3% of each employee’s salary per pay period that has been employed over a year. This contribution would be the only expense regarding this pension plan for each pay period (Schroeder, Clark, & Cathey, 2005). Defined benefit plans require future amounts to be received will be paid according to the terms of the plan. Under defined benefit plans, there are requirements that must be met. According to the FASB ASC 715-70-50, the employer must disclose amounts of cost recognized for a defined contribution pension plans and for defined contribution postretirement benefit plans for periods that are presented separately from amounts of cost recognized for defined benefit plans (FASB, 2011).
Two New Segments
Regarding the two segments the new acquisition as, leads our company to investigate if the two segments can be eliminated. The provisions for SFAS No. 131 require companies to report separately balance sheet and income statement information about each operating segment (Schroeder, Clark, & Cathey, 2005). In addition to measure of a segment’s profit or loss and total asset, companies must report specific information if it is included in the measure of segment profit or loss by chief
Required Reporting’s for Pension Plans
There are two frequently used pension plans which are defined benefit and contribution plans. Defined contribution plan consist of the employer’s promise to contribute a certain amount into the plan every pay period (Schroeder, Clark, & Cathey, 2005). For example, the company will contribute say 3% of each employee’s salary per pay period that has been employed over a year. This contribution would be the only expense regarding this pension plan for each pay period (Schroeder, Clark, & Cathey, 2005). Defined benefit plans require future amounts to be received will be paid according to the terms of the plan. Under defined benefit plans, there are requirements that must be met. According to the FASB ASC 715-70-50, the employer must disclose amounts of cost recognized for a defined contribution pension plans and for defined contribution postretirement benefit plans for periods that are presented separately from amounts of cost recognized for defined benefit plans (FASB, 2011).
Two New Segments
Regarding the two segments the new acquisition as, leads our company to investigate if the two segments can be eliminated. The provisions for SFAS No. 131 require companies to report separately balance sheet and income statement information about each operating segment (Schroeder, Clark, & Cathey, 2005). In addition to measure of a segment’s profit or loss and total asset, companies must report specific information if it is included in the measure of segment profit or loss by chief
References: FASB. (2011). Accounting standards codification 715-70-50, Compensation – retirement benefits. Retrieved on February 4, 2011 from: http://asc.fasb.org/viewpage?nav_type=goto&ovcmd=goto&codification_text=715-70-50#topic-715-40-50-subsect-01-114942 Schroeder, R., Clark, M., & Cathey, J. (2005). Financial Accounting Theory and Analysis (8th ed.). Hoboken, New Jersey: John Wiley & Sons, Inc. retrieved January 4, 2011 from University of Phoenix eBook collection