Companies must disclose a reconciliation of how the defined benefit obligation and the fair value of plan assets changed during the year either in their financial statements or in the notes.

Question

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This statement is true. Companies must disclose a reconciliation of how the defined benefit obligation (DBO) and the fair value of plan assets (FVPA) changed during the year either in their financial statements or in the notes. The reconciliation shows the opening balance of the DBO and FVPA, the current service cost, interest cost, contributions made by the employer and employees, actuarial gains and losses, benefits paid, and closing balances of the DBO and FVPA. This is required under accounting standard IAS 19 (or ASC 715 for US GAAP).

Companies Must Disclose a Reconciliation of How the Defined Benefit