The pension asset/liability reported within the balance sheet must reflect the funded status of the pension plan.

Question

Quizplus · Accepted Answer

The funded status of a pension plan refers to the difference between the fair value of assets and the projected benefit obligation (PBO) of the plan. This funded status should be reflected in the balance sheet as an asset or liability, depending on whether the fair value of plan assets exceeds or is less than the PBO. Thus, the statement is true.

The Pension Asset/liability Reported Within the Balance Sheet Must Reflect