Sifto
05-02-2008, 12:20 AM
(note: numbers in $000s)
There's something a little strange in this question. For part b) in order to determine the AOCI at Dec 31, 2006 I determined the net gain/loss for 2006 by means of a balancing item. In other words:
accrued benefit liability (ABL) at Dec 31, 2006 = ABL at Dec 31, 2005 + pension expense for 2006 - 2006 ER contributions
=48436 + 51813 - 37000
= 63249.
Then I go:
ABO = (810000)
Assets = 565000
Funded status = (245000)
Unamort. PSC = 56195 (equal to 63847 - 7652)
Unamort. (gain)/loss = X
Accrued benefit asset (liability) = (63249)
Therefore X = 125376. This is how I normally determine the unamort. net gain/loss because it's faster than actually calculating the gain/loss on the ABO and assets separately. However, the latter is what the solution does and gets a net loss of 446 for the period. I got 267 as my net loss.
All i can think of is that since NOC adopted FAS158 in Dec 31, 2005, I cannot continue to use the ABL above. But it should still work because the expense number and the cash flows do not change.
My unamortized net actuarial loss was 125736
There's something a little strange in this question. For part b) in order to determine the AOCI at Dec 31, 2006 I determined the net gain/loss for 2006 by means of a balancing item. In other words:
accrued benefit liability (ABL) at Dec 31, 2006 = ABL at Dec 31, 2005 + pension expense for 2006 - 2006 ER contributions
=48436 + 51813 - 37000
= 63249.
Then I go:
ABO = (810000)
Assets = 565000
Funded status = (245000)
Unamort. PSC = 56195 (equal to 63847 - 7652)
Unamort. (gain)/loss = X
Accrued benefit asset (liability) = (63249)
Therefore X = 125376. This is how I normally determine the unamort. net gain/loss because it's faster than actually calculating the gain/loss on the ABO and assets separately. However, the latter is what the solution does and gets a net loss of 446 for the period. I got 267 as my net loss.
All i can think of is that since NOC adopted FAS158 in Dec 31, 2005, I cannot continue to use the ABL above. But it should still work because the expense number and the cash flows do not change.
My unamortized net actuarial loss was 125736