Federal Retirement benefits reporting addressed by FASB

Recently FASB has come in the news because they released two different proposals this past week that are aimed at addressing some of the reporting issues that federal officers face regarding their Federal Retirement Benefits.

FASB’s proposals address federal retirement benefits concerns:

Proposed Accounting Standards Update (ASU), Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post retirement Benefit Cost is the name of the proposal put forward by the agency. It addresses the major concern of presenting the fixed benefit cost on a net basis to combine elements with a variety of predictable values. All the users of such statements have let FASB know that the net benefit cost’s service cost component is almost always treated in a different manner when compared to other constituents.

According to this proposal, the employer would file the cost component of the service in the same line of items as the other costs of compensation that arise from the rendered services of the employees that have been affected by the period. There is other information in this regard mentioned in the proposal as well.

All the changes that have been made complying to the proposal would be applicable to all the employers regardless of the fact that they are for-profit or not. The only requirement is that they should offer benefit plans that are defined or other post-federal retirement benefit plans or any other benefits for that matter.