The income statement reporting for other postretirement benefits is based on the

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Other postretirement benefits, such as healthcare and life insurance, are typically accrued and recognized as an expense in the period in which the employee earns the benefits. Therefore, the income statement reporting for these benefits is based on the accrual basis of accounting. The cash basis of accounting would not accurately reflect the expenses associated with these benefits. While cash or accrual basis can be used for other types of expenses, such as operating expenses, for postretirement benefits, accrual basis is the appropriate method. The tax code does not specifically dictate the accounting method to be used for reporting other postretirement benefits.

The Income Statement Reporting for Other Postretirement Benefits Is Based