Post-employment Benefits (including pensions)
In response to calls from preparers and users of financial statements, the IASB is conducting a project that will result in significant improvements to pension accounting. The IASB intends to complete limited scope amendments to IAS 19 within four years, pending a fundamental review of all aspects of post-employment benefit accounting.
As a result of the Board’s review of comments received on the discussion paper, published in March 2008, and further input received from a broad range of stakeholders, the Board decided to work towards three separate exposure drafts as follows:
- an ED on the discount rate for measuring employee benefits;
- an ED on the recognition and presentation of changes in the defined benefit obligation and in plan assets, disclosures, and other issues raised in the comment letters that can be addressed expeditiously; and
- an ED on contribution-based promises, potentially as part of a comprehensive review of pension accounting.
At its October meeting, the Board decided not to proceed with an amendment to the discount rate for measuring employee benefits.
What will happen next ?
In December, the Board will discuss two aspects of the definition of remeasurements:
- Changes in estimates of the service cost; and
- Interest income.
The Board aims to publish the ED on recognition, disclosures and other issues early in 2010 and a final standard in the first half of 2011
Other related projects
The Board is also working towards final amendments on the following topics:
- The Board issued Prepayments of a minimum funding requirement (Amendments to IFRIC 14) on 26 November 2009.
- Termination benefits (Amendments to IAS 19).
In June 2005, the Board published an Exposure Draft of Amendments to IAS 19, dealing with the accounting for termination benefits, together with proposed amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets. In October 2009, the Board tentatively decided that entities should apply the amendments for annual periods beginning on or after 1 January 2011 with early adoption permitted. The Board will discuss these amendments further at its December 2009 meeting.