Benefit plan reporting entity belongs in a plan-specific employer file. The benefit plan and its sponsor are separate reporting entities. Trust assets support participants and belong in plan-level statements, while the sponsor recognizes its employer accounting under Topic 715.
Apply it
When a sponsor contributes $1.2 million, its cash falls and the trust's assets rise. Posting the trust securities as sponsor investments would count the same resources twice and ignore their restriction.
Common mistake
Do not assume that the benefit trust and the employer are one reporting entity. The trust holds plan assets for participants; the employer reports its own cost, cash contribution, and funded-status amount. That error would double count restricted trust assets as resources available to the employer.
Keep the boundary clear
This page covers the employer-versus-plan boundary. Preparing plan statements under Topics 960, 962, or 965 and deciding legal ownership require their own evidence and expertise.
Authority
Read ASC 715-30-15-1 for the employer accounting scope for a defined benefit pension plan.
Put the concept to work
Apply this concept
- Explain and apply benefit plan reporting entity within a reconciled employer benefit-plan workpaper using supplied authoritative and actuarial facts.
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Build on these ideas
- Employee benefit arrangement — Apply
To apply this concept: Required. This prior concept supplies the plan route or reconciled input required here.
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Use this idea next
- Pension plan assets — Apply
Required level here: apply. Required. This prior concept supplies the plan route or reconciled input required here.