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13.7 Pensions and other postemployment benefits—considerations for private companies
Publication date: 31 Mar 2024
us Financial statement presentation guide
This section covers special considerations for nonpublic companies and highlights the differences in disclosure requirements from those applicable to public reporting entities.
A "nonpublic entity" is defined in ASC 715 as follows:
Definition from ASC 715-20-20
Any entity other than one with any of the following characteristics:
- Whose debt or equity securities trade in a public market either on a stock exchange (domestic or foreign) or in the over-the-counter market, including securities quoted only locally or regionally
- That is a conduit bond obligor for conduit debt securities that are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local or regional markets)
- That makes a filing with a regulatory agency in preparation for the sale of any class of debt or equity securities in a public market
- It is required to file or furnish financial statements with the Securities and Exchange Commission.
- That is controlled by an entity covered by (a) through (d).
The disclosures for nonpublic company defined benefit plans are similar to those of a public reporting entity, with several exceptions, as illustrated in Figure FSP 13-3.
Figure FSP 13-3
Differences in disclosure requirements for nonpublic entities
Differences in disclosure requirements for nonpublic entities
Required disclosures for public but not nonpublic entities | Required disclosures for nonpublic entities | Nonpublic entity reporting reference | Section where public company requirements are discussed |
|---|---|---|---|
Reconciliation of the beginning and ending balances of the benefit obligation and the fair value of plan assets
| End of year balances for benefit obligation and fair value of plan assets, employer and participant contributions, and benefits paid
| ||
Reconciliation of the opening balances to the closing balances of plan assets measured on a recurring basis in Level 3 of the fair value hierarchy.
| Amounts of transfers into and out of Level 3 of the fair value hierarchy and purchases of Level 3 plan assets
| ||
Components of net periodic benefit cost
| Amount of net periodic benefit cost
| ||
Significant change in benefit obligation or fair value of plan assets, including an explanation of the reasons for significant gains and losses affecting the benefit obligation
| Nature and effect of significant nonroutine events, including an explanation of the reasons for significant gains and losses affecting the benefit obligation
| ||
Alternative method used to amortize prior service cost or gains and losses
| Not applicable
| Not applicable
| |
Substantive commitment used as a basis for accounting for benefit obligation
| Not applicable
| Not applicable
|
PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.
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