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IFRS Pension Reporting 2009
IAS 19 is the equivalent to FAS 158, but there are differences in the two standards. (Meg, 2009) Under IAS 19 the current rates of return is used on high quality corporate bonds with maturities consistent with the duration of benefit obligations, where under FAS 158, the discount rate is used at which the obligation could be effectively settled. Under IAS 19, the rate is based on current market expectations over the life of the obligation, where under FAS 158 the rate of return on the plan assets is the expected long-term rates over the life of the obligation. The cost recognized is calculated almost the same way under both standards with the exception being under FAS 106, the temporary deviations from the plan can be added or subtracted.
IFRS methodology is very similar to U.S. GAAP with deferred recognition of actuarial gains and losses except past service costs are recognized immediately instead of being amortized over the service period, or the life expectancy of the workers. (Epstein) The actuarial gains and losses can be recognized...
GAAP. There is no minimum liability reported in the statement of financial position under IFRS, but there is under U.S. GAAP. IFRS limits the recognition of pension assets, where U.S. GAAP has not limitations. The curtailment gains and losses are recognized when announced under IFRS and is calculated different from U.S. GAAP. Termination benefits are expensed when the employer is committed to pay under IFRS where U.S. GAAP they are expensed when the employee accepts and they can be estimated.
In Pepsi Company's 2009 Annual Report there is no mention about the changes of the IFRS in the pensions of the foreign subsidiaries (Pepsi Co 2009 Annual Report, 2009). Pepsi Company's pension fund would still be impacted by the IFRS standards, simply because of the foreign subsidiaries having pension assets and being included in the overall pension fund of the company. The pension assets and the way expenses and costs are expensed under IFRS instead of being deferred under U.S. GAAP will have an impact on the outcome of the fund at…
Bibliography
Item 8. Fnancial Statements & Supplementary Data. (2009, Dec 31). Retrieved from The Coca Cola Company: http;//www.thecoca-colacompany.com/investors/pdfs/10-k_2009/12_Coca-Cola_Item8.pdf
Pepsi Co 2009 Annual Report. (2009, Dec 31). Retrieved from Pepsi Co: http://www.pepsico.com/Download/PEPSICO_AR.pdf
Epstein, B.J. (n.d.). IFRS vs. GAAP. Retrieved from Dr. Barry J. Epstein, CPA: http://www.ifrsaccounting.com/ifrs-pensions.html
Meg, G. (2009, May 1). U.S. GAAP Vs. IFRS: Pension Expenses. Retrieved from Yahoo Voices: http://voices.yahoo.com/us-gaap-vs.-ifrs-pension-expenses-3192808.html?cat=3
For example, there are many SEC registered companies, and they are not all American companies. Many of them are actually headquartered in foreign countries. In the past they had to change their accounting and financial information over to GAAP requirements, but changes are allowing companies to continue to use IFRS instead. Some of the U.S. based companies are also going to be allowed to use IFRS in order to
IFRS and GAAP Convergence Briefly describe Walmart The company establishment was in 1962 by Sam Walton. The company has grown through mergers and acquisitions to become the largest retail outlet in the globe. The main business of the company is corporate retail. The retailer offers a variety of products to its customers at a lower price compared to its competition. According to Fortune 500 ratings, the corporation ranks third among the largest
IFRS 8 Operating Segments was to a certain degree a ground-breaking law since it represented the first foray of the International Accounting Standards Board into the area of requiring companies and business to disclose information through their management. The regulation requires certain categories of business, especially publicly traded companies to disclose information regarding their products and services, operating segments, and geographic areas where they operate. In addition to the information
IFRS Human Resource Accounting The United States has a radically different accounting system than virtually every other the countries considered. The United States has their own system known as the general accepted accounting principles (GAAP). Other countries have used this system in the past, such as the UK and Germany, but there has been an international standard that has developed over the course of the last few years and virtually every other
For instance, a parent company that has a low level of ownership in a subsidiary may want to lower the price paid to that subsidiary to increase parent company profits. Or, if the subsidiary has a lower dividend payout, the parent may wish to pay a high price to that subsidiary to avoid larger dividend payouts at home. Further, high import tariffs at the parent's country may lead to
Herz (2013) notes that the end of convergence will essentially bring about an era where IFRS is, for the most part, the de facto standard around the world. However, the process has also compelled the IASB to be more responsive to its constituents. For Australians, involvement in ASAF signals the beginning of the final stages of convergence, where the remaining non-IFRS major economies are brought into the process. Many countries with