ExpertEasy1 markMultiple Choice
CPA · Question 41 · Area II: Technical Accounting
Which of the following financial statements is required for a Defined Contribution Pension Plan?
Which of the following financial statements is required for a Defined Contribution Pension Plan?
Answer options:
A.
Statement of Net Assets Available for Benefits
B.
Statement of Accumulated Plan Benefits
C.
Statement of Comprehensive Income
D.
Statement of Cash Flows
How to approach this question
Defined Contribution = Net Assets + Changes. Defined Benefit = Net Assets + Changes + Accumulated Benefits.
Full Answer
A.Statement of Net Assets Available for Benefits✓ Correct
Defined Contribution plans must present a Statement of Net Assets Available for Benefits and a Statement of Changes in Net Assets Available for Benefits. They do not report accumulated plan benefits because the benefit is not defined.
Common mistakes
Confusing DC and DB reporting requirements.
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