# ASC 205-965-50: Presentation of Financial Statements — Plan Accounting—Health and Welfare Benefit Plans — 50 Disclosure Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/205/965/#50-disclosure) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-09T22:57:55.221Z to 2026-09-09T22:57:55.221Z Record version: sha256:be4caad3ca79826ea5608c4ad82156b75dd311a54e7c569d0392914bb1d20260 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 205-965-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/205/965/#50-disclosure) SEC content: no ##### [205-965-50-1](https://asc.understandingaccounting.org/asc/205/965/#205-965-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T22:57:55.221Z to 2026-09-09T22:57:55.221Z Record version: sha256:25dfd28df1e1c8c9ac9633be81bd73ffc53d8a6bc0897f712a0ea8bd0b284aeb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The plan's financial statements shall disclose other information as described in this Subtopic. Certain of the disclosures relate to plans with accumulated assets rather than those with trusts that act more as conduits for benefit payments or insurance premiums. Separate disclosures may be made to the extent that the plan provides both health and other welfare [benefits](https://asc.understandingaccounting.org/glossary/b/#benefits "The monetary or in-kind benefits or benefit coverage to which participants may be entitled under a pension plan or a health and welfare plan (which can include active, terminated, and retired employees or their dependents or beneficiaries). Examples of benefits may include, but are not limited to, health care benefits, life insurance, legal, educational, and advisory services, pension benefits, disability benefits, death benefits, and benefits due to termination of employment."). The disclosures shall include, if applicable, all of the following: 1. a A brief, general description of the plan agreement, including, but not limited to, participants covered, vesting, and benefit provisions. If a plan agreement or a description thereof providing this information is otherwise published or made available, the description in the financial statement disclosures may be omitted, provided that a reference to the other source is made. 2. b A description of significant plan amendments adopted during the period, as well as significant changes in the nature of the plan (for example, a plan spinoff or merger with another plan) and changes in actuarial assumptions. 3. c The funding policy and any changes in the policy made during the plan year. If the benefit obligations exceed the net assets of the plan, the method of funding this deficit, as provided for in the plan agreement or collective bargaining agreement, also shall be disclosed. If significant plan administration or related costs are being borne by the employer, that fact shall be disclosed. For a contributory plan, the disclosure shall state the method of determining participants' contributions. For each year for which a year-end statement of net assets available for benefits is presented, the plan shall disclose a description of the portion of the plan's estimated cost of providing postretirement benefits funded by retiree contributions. The plan's estimated cost of postretirement benefits is the plan's expected claims cost for the year. It excludes benefit costs paid by Medicare and costs, such as deductibles and copayments, paid directly to the medical provider by participants. The portion of the plan's estimated cost that is funded by retiree contributions is determined at the beginning of the year based on the plan sponsor's cost-sharing policy. In determining that amount, the retirees' required contribution for the year shall be reduced by any amounts intended to recover a shortfall (or increased by amounts intended to compensate for an overcharge) in attaining the desired cost-sharing in prior year(s). If the plan terms provide that a shortfall in attaining the intended cost sharing in the prior year(s) is to be recovered by increasing the retiree contribution in the current year, that incremental contribution shall be separately disclosed. Similarly, if the plan terms provide that participant contributions in the current year are to be reduced by the amount by which participant contributions in the prior year exceeded the amount needed to attain the desired cost-sharing, the resulting reduction in the current year contribution shall be separately disclosed. The information about retiree contributions shall be provided for each significant group of retired participants to the extent their contributions differ. 4. d The federal income tax status of the plan. 5. e The policy regarding the purchase of contracts with insurance entities that are excluded from [plan assets](https://asc.understandingaccounting.org/glossary/p/#plan-assets "Assets—usually stocks, bonds, and other investments (except certain insurance contracts as noted in paragraph 715-60-35-109)—that have been segregated and restricted (usually in a trust) to be used for a health and welfare plan (which can include active, terminated, and retired employees or their dependents or beneficiaries). The amount of plan assets includes amounts contributed by the employer, and by plan participants for a contributory plan, and amounts earned from investing the contributions, less benefits, income taxes, and other expenses incurred. Plan assets ordinarily cannot be withdrawn by the employer except under certain circumstances when a plan has assets in excess of obligations and the employer has taken certain steps to satisfy existing obligations. Securities of the employer held by the plan are includable in plan assets provided they are transferable. Assets not segregated in a trust, or otherwise effectively restricted, so that they cannot be used by the employer for other purposes are not plan assets, even though the employer may intend that those assets be used to provide health and welfare benefits, which may include postretirement benefits. Those assets shall be accounted for in the same manner as other employer assets of a similar nature and with similar restrictions. If a plan has liabilities other than for benefits, those nonbenefit obligations are considered as reductions of plan assets. Amounts accrued by the employer but not yet paid to the plan are not plan assets. If a trust arrangement explicitly provides that segregated assets are available to satisfy claims of creditors in bankruptcy, such a provision would effectively permit those assets to be used for other purposes at the discretion of the employer. It is not necessary to determine that a trust is bankruptcy-proof for the assets of the trust to qualify as plan assets. However, assets held in a trust that explicitly provides that such assets are available to the general creditors of the employer in the event of the employer's bankruptcy would not qualify as plan assets."). Consideration should be given to disclosing the type and extent of insurance coverage, as well as the extent to which risk is transferred (for example, coverage period and claims reported or claims incurred). 6. f The amounts and types of securities of the employer and related parties included in plan assets, and the approximate amount of future annual benefits of plan participants covered by insurance contracts issued by the employer and related parties. 7. g Significant real estate or other transactions in which the plan and any of the following parties are jointly involved: 1. 1 The sponsor 2. 2 The plan administrator 3. 3 Employers 4. 4 Employee organizations. 8. h Unusual or infrequent events or transactions occurring after the financial statement date, but before the financial statements are issued or are available to be issued (as discussed in Section 855-10-25), that might significantly affect the usefulness of the financial statements in an assessment of the plan's present and future ability to pay benefits. For example, all of the following shall be disclosed: 1. 1 A plan amendment adopted after the latest financial statement date that significantly increases future benefits attributable to an employee's service rendered before that date 2. 2 A significant change in the fair value of a significant portion of the plan's assets 3. 3 The emergence of a catastrophic claim. If reasonably determinable, the effects of such events or transactions shall be disclosed. If such effects are not reasonably determinable, the reasons why they are not quantifiable shall be disclosed. 9. i Any of the following commitments or contingencies: 1. 1 Material lease commitments 2. 2 Other commitments 3. 3 Contingent liabilities. 10. j The assumed health care cost-trend rate(s) used to measure the expected cost of benefits covered by the plan for the next year, including both of the following: 1. 1 A general description of the direction and pattern of change in the assumed trend rates thereafter 2. 2 The ultimate trend rate(s) and when that rate is expected to be achieved. 11. k For [health and welfare benefit plans](https://asc.understandingaccounting.org/glossary/h/#health-and-welfare-benefit-plans "Health and welfare benefit plans include plans that provide the following: Any of the following benefits: Medical, dental, visual, psychiatric, or long-term health care Life insurance (offered separately from a pension plan) Certain severance benefits Accidental death or dismemberment benefits. Benefits for unemployment, disability, vacations, or holidays Other benefits such as apprenticeships, tuition assistance, day care, dependent care, housing subsidies, or legal services.") providing postretirement health care benefits, the effect of a one-percentage-point increase in the assumed health care cost-trend rates for each future year on the postretirement benefit obligation 12. l Any modification of the existing cost-sharing provisions that are encompassed by the substantive plan(s) and the existence and nature of any commitment to increase monetary benefits provided by the plan and their effect on the plan's financial statements. 13. m Termination provisions of the plan and priorities for distribution of assets, if applicable. 14. n Restrictions, if any, on plan assets (for example, legal restrictions on multiple trusts) 15. o For a defined contribution health and welfare plan, the accounting policy for, and the amount and disposition of, forfeited nonvested accounts. Specifically, identification of whether those amounts will be used to reduce future employer contributions, employer expenses, or will be allocated to participants' accounts. #### 401(h) Accounts ##### [205-965-50-2](https://asc.understandingaccounting.org/asc/205/965/#205-965-50-2) Pending content: no Source downloaded (UTC): 2026-09-09T22:57:55.221Z to 2026-09-09T22:57:55.221Z Record version: sha256:b96b81999a2a35ae32a617e8b47756d4c01036b5269e8e4c4d08ace55a35e94c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [965-205-45-6 through 45-8](https://asc.understandingaccounting.org/asc/205/965/#205-965-45-6) for disclosure requirements for [401(h) account](https://asc.understandingaccounting.org/glossary/h/#401-h-accounts "A postretirement medical-benefit component provided in some defined benefit pension plans in addition to the normal retirement benefits of the plan, pursuant to Section 401(h) of the Internal Revenue Code.") assets and liabilities and the changes thereto if such information is not presented separately in the financial statements. The notes to financial statements shall disclose the significant components of net assets and changes in net assets of the 401(h) account. ##### [205-965-50-3](https://asc.understandingaccounting.org/asc/205/965/#205-965-50-3) Pending content: no Source downloaded (UTC): 2026-09-09T22:57:55.221Z to 2026-09-09T22:57:55.221Z Record version: sha256:46a21c5321bb254c2c081bd0b30fd8352a675ca7bebf26a355176234aa6c8ace Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If retiree health benefit obligations are funded partially through a 401(h) account of the defined benefit pension plan, the plan shall also disclose the fact that the assets are available only to pay retiree health benefits. The notes to financial statements shall disclose the significant components of net assets and changes in net assets of the 401(h) account. Additionally, the notes shall include a reconciliation of amounts reported in the financial statements to the amounts reported in the Form 5500 of the Internal Revenue Service (IRS). ##### [205-965-50-4](https://asc.understandingaccounting.org/asc/205/965/#205-965-50-4) Pending content: no Source downloaded (UTC): 2026-09-09T22:57:55.221Z to 2026-09-09T22:57:55.221Z Record version: sha256:cab6dadd1ea620eb249c1b5d240a4f93fab93bb376ce7b9bfc8e9f6795b3e0f2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Because the Employee Retirement Income Security Act requires 401(h) accounts to be reported as assets of the pension plan, a reconciliation of the net assets reported in the financial statements to those reported in the Form 5500 is required for the health and welfare benefit plan. ##### [205-965-50-5](https://asc.understandingaccounting.org/asc/205/965/#205-965-50-5) Pending content: no Source downloaded (UTC): 2026-09-09T22:57:55.221Z to 2026-09-09T22:57:55.221Z Record version: sha256:8636b9e599698b1b8e8f29d8b63acbbb46f26f1236910bcc755e265404ff8bfe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A plan is not required to provide investment disclosures (for example, the disclosures required by Topic 815 on derivatives and hedging and Topic 820 on fair value measurement) for 401(h) account assets. A plan shall disclose the name of the defined benefit pension plan that allocated the funds to the health and welfare benefit plan and that provides the related investment disclosures. #### Defined Benefit Health and Welfare Plans ##### [205-965-50-6](https://asc.understandingaccounting.org/asc/205/965/#205-965-50-6) Pending content: no Source downloaded (UTC): 2026-09-09T22:57:55.221Z to 2026-09-09T22:57:55.221Z Record version: sha256:1798243649e172ceb28cb438be117c6aa81ff8f9d1829741ef170cf267623cd6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Information about the benefit obligations shall be presented in a separate statement, combined with other information on another financial statement, or disclosed in the notes to financial statements. Regardless of the format selected, the plan financial statements shall present the benefit obligations information in its entirety in the same location. The information shall be presented in such reasonable detail as is necessary to identify the nature and classification of the obligations. See Examples 1 through 3 (paragraphs [965-205-55-2 through 55-7](https://asc.understandingaccounting.org/asc/205/965/#205-965-55-2) ) for illustrative financial statements of [health and welfare benefit plans](https://asc.understandingaccounting.org/glossary/h/#health-and-welfare-benefit-plans "Health and welfare benefit plans include plans that provide the following: Any of the following benefits: Medical, dental, visual, psychiatric, or long-term health care Life insurance (offered separately from a pension plan) Certain severance benefits Accidental death or dismemberment benefits. Benefits for unemployment, disability, vacations, or holidays Other benefits such as apprenticeships, tuition assistance, day care, dependent care, housing subsidies, or legal services."). (See paragraph [965-205-45-2](https://asc.understandingaccounting.org/asc/205/965/#205-965-45-2).)