Actual return on plan assets belongs in a plan-specific employer file. Actual return is the economic change in plan assets after controlled contributions, benefits, purchases, settlements, fees, and transfers. Derive it only after those cash flows and values are complete.
Apply it
Ending assets of $16.15 million minus $15 million opening assets, minus $1.2 million contributions, plus $1.1 million benefits, give $1.05 million actual return.
Common mistake
Do not assume that actual return is the return credit in pension cost. Actual return reconciles plan assets; expected return enters periodic cost, and their difference enters the gain-or-loss bridge. That error would put the wrong return amount into periodic cost and leave the gain-or-loss bridge incomplete.
Keep the boundary clear
Actual return belongs in the asset rollforward. Expected return belongs in periodic cost; their difference enters the asset gain-or-loss bridge.
Authority
Read ASC 715-30-35-22 for the difference between actual and expected asset return.
Put the concept to work
Apply this concept
- Explain and apply actual return on plan assets within a reconciled employer benefit-plan workpaper using supplied authoritative and actuarial facts.
Learning resources
Choose a lesson, try an application, or inspect the sources behind this concept.
Build on these ideas
- Pension plan assets — Apply
To apply this concept: Required. This prior concept supplies the plan route or reconciled input required here.