Wiley GAAP 2008

Concepts, Rules, and Examples

In addition to varying by basic type (defined benefit plan, defined contribution plan, and health and welfare benefit plan), employee benefit plans vary by operating and administrative characteristics. Plans established by one employer or a group of controlled corporations are referred to as single employer plans. Alternatively, they can include the employees of many employers who are related in some way, often by all being parties to a collective‐bargaining agreement. Those plans are referred to as multiemployer plans. A plan can be either contributory or noncontributory. A contributory plan requires both the employer and the participants to fund (contribute to) the cost of the future benefits. In a noncontributory plan, the participants do not fund any part of the cost of the future benefits. Insured plans are funded through insurance contracts. Self‐funded plans are funded through contributions and investment return. Split‐funded plans are funded by a combination of insurance contracts, contributions, and investment return.

Complete Set of Financial Statements

The primary objective of a plan's financial statements is to provide the information necessary to assess the plan's ability to pay benefits when due. Thus, financial statements are to include information about the plan's resources, the results of transactions and events that changed the plan's resources, the stewardship of management over the plan's resources, and any other facts necessary ...