Multiemployer plan belongs in a plan-specific employer file. A multiemployer plan pools contributions and benefits for employees of unrelated employers under collective administration. A participating employer generally recognizes its required contribution and the disclosures or contingencies supported by its facts.
Apply it
If the required annual contribution is $420,000 and $390,000 was paid, pension cost is $420,000 and the contribution payable is $30,000.
Common mistake
Do not assume that a participating employer records its share of a multiemployer plan's aggregate underfunding. Apply the multiemployer model to required contributions and disclosures; assess withdrawal exposure under its separate guidance. That error would replace the contribution model with a proportional liability that Topic 715 does not prescribe.
Keep the boundary clear
The employer does not multiply total plan underfunding by its contribution share. Withdrawal exposure, legal funding, and plan-level financial statements follow separate analyses.
Authority
Read ASC 715-80-35-1 for the required-contribution model for a participating employer.
Put the concept to work
Apply this concept
- Explain and apply multiemployer plan 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
- Employee benefit arrangement — Apply
To apply this concept: Required. This prior concept supplies the plan route or reconciled input required here.