According to the IAS 19 R, the difference between the fair value of the pension related assets and the Defined benefit obligation should be accounted in OCI. My problem is in the accounting scheme adopted to get the target balance sheet.
Let's assume the following:
- The pension related assets have a historical value of 1000,00
- The fair value of assets is 1200,00 at the end of the year
- the DBO is 1500,00
In this case, my interpretation allows me to draw two target balance sheets. 1st question: Which one is correct?
Assets 1000 Liabilities 300,00
Assets 0 Liabilities 300,00
Which are the accounting schemes to adopt for a better conformity with the norm?
Thank you for your reply.