Study On The Accounting For Defined Benefit Plans

According to the CAS9-Employee Benefits revised and distributed in 2014,postemployment benefits consist of defined benefit plans and defined contribution plans.In allusion to the two different kinds of post-employment benefits,the accounting that we adopt will also be different.Defined contribution plans,which has formed a consolidated and normative accounting system,will be easier.However,as for defined benefit plans,the theory about it is not mature while the practices of it is still developing.Under this condition,it is greatly urgent to set up perfect accounting system of defined benefit plans in order to fairly reflect the influence defined benefit plans made on financial position and financial performance.The accounting of defined benefit plans involves asset,liability,expense and other accountant elements.But there are disagreements in recognition and measurement of each element.The accounting of defined benefit plans liabilities needs to make sure the allocation method,the allocation period and the discount rate of the defined benefit plan clearly.And the accounting of the assets of the defined benefit plan needs to clear the plan assets,the asset ceiling and other problems.Otherwise,the accounting of the defined benefit costs should make sure past service cost,interest income on plan assets,actuarial gains and losses and other problems.Although CAS9(2014)has some rules on these problems,these rules are set unreasonably and undetailed.Therefore,this paper aims at doing research about the main problems of defined benefit plan so as to replenish and promote relevant stipulation of criterion.This paper mainly analyzes and discusses the accounting problems of defined benefit plans,and puts forward the writer's own views from three aspects: liability of defined benefit plans,assets of defined benefit plans and defined benefit cost.First of all,based on the definition and nature of the beneficiary plan,the writer put forward that the accounting of defined benefit plans is using the method of distributing wages lingeringly and adopting accrual basis.This is the basis for accounting study of defined benefit plans.And then combining with the domestic and international standards and the scholars' analysis and summary,the writer put forward the problems and the point that we can learn from which are still existing in accounting of current defined benefit plans.Finally,based on the previous relevant discussion,this paper makes an in-depth argument on the liabilities of defined benefit,the assets of defined benefit and employee benefits of defined benefit plans from the perspective of accounting theory and practice,and proposes to adopt the market yields(at the end of the reporting period)on government bonds to count the liability of defined benefit plans.While,the writer thinks that the differences between fair value and carrying value of plan assets should be counted into other comprehensive income and that the accounting standards of the asset ceiling should be cancelled.Besides,we should use immediate confirmation to confirm past service costs and use the rates of return expected to count interest income of plan assets.What's more,the writer revised the "corridor law".These are the main problems about the accounting of defined benefit plans,but other problems should be studied further in order to form thorough accounting basis of defined benefit plans.