Learning Objective $17-03$ Describe the five events that might change the balance of the PBO.

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The PBO can change due to the accumulation of service cost from year to year, the accrual of interest as time passes, making plan amendments retroactive to prior years $($prior service cost$),$ and periodic adjustments when estimates change $($gains and losses$).$ The obligation is reduced as benefits actually are paid to retired employees$\mathrm{.}1.$ An increase in the estimate of an employee$$s final salary not attempted the PBO.

$2.$ A change in the assumed discount rate to a lower rate not attempted the estimate of the PBO.

$3.$ A change in the assumed discount rate to a higher discount rate will not attempted $.$