Question

The financial statements of a defined benefit pension plan provide only limited information as to its economic condition. The following information relates to the Lincoln County Firefighters Pension Plan (dollar amounts in thousands):
Beginning-of-Year Balances
Cash and cash equivalents, January 1.............................................................. $ 67
Marketable securities and other investments at fair value, January 1 ........... 3,180
Current liabilities to retirees, January 1................................................................ 4
Actuarial accrued liability, January 1..............................................................3,430
Transactions during the Year
Contributions received during the year from employers and employees........... 138
Benefits to which retirees were entitled during the year................................... 120
Benefits actually paid to retirees, including amounts owed from prior year..... 122
Interest and dividends earned during the year.................................................. 145
Net appreciation in fair value of marketable securities and other
investments (i.e., realized and unrealized gains) during the year.................. 36
Investment management costs............................................................................. 10
Administrative expenses...................................................................................... 35
End-of-Year Balances
Cash on hand, December 31............................................................................. 92
Marketable securities and other investments at fair value, December 31...... 3,307
Current liabilities to retirees, December 31.......................................................... 2
Actuarial accrued liability, December 31....................................................... 3,690
1. Prepare a statement of plan net assets as of January 1. You might not need to include all of the data provided.
2. Prepare a statement of changes in plan net assets for the year.
3. Prepare a statement of plan net assets as of December 31.
4. Comment on the significance of the data provided that you did not include in your statements. Where in the plan’s financial report is this information reported?
5. Determine the amount of the unfunded actuarial accrued liability as of December 31, assuming that the actuarial value of the plan assets is the same as their fair value. (Some-times actuaries use average values over several years rather than point-in-time values as of the date of the financial statements.)


$1.99
Sales3
Views160
Comments0
  • CreatedApril 29, 2015
  • Files Included
Post your question
5000