# ASC 325-962-35: Investments—Other — Plan Accounting—Defined Contribution Pension Plans — 35 Subsequent Measurement Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/325/962/#35-subsequent-measurement) 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): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:fb9ae9150b00554aca0fc12f50a0e59f7c3afb55259a501b7adb634db91ef8e8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 325-962-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/325/962/#35-subsequent-measurement) SEC content: no #### Reporting at Fair Value ##### [325-962-35-1](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:b0e928e32b1ca5d2e722ffe235016d18a265440f3d38705ecee8aff46f2a335c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Plan investments should generally be presented at their [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") at the reporting date (see paragraph [965-325-35-3](https://asc.understandingaccounting.org/asc/325/965/#325-965-35-3) for special provisions concerning the valuation of insurance contracts and paragraph [962-325-35-5](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-5) for special provisions concerning the valuation of fully benefit-responsive investment contracts). ##### [325-962-35-1A](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-1A) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:a902e9515f113abe2770b90bf7561be4f7862fc226ca1a4e0ee76f8c45921070 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If significant, the fair value of an investment shall be reduced by brokerage commissions and other costs normally incurred in a sale (similar to fair value less cost to sell). ##### [325-962-35-1B](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-1B) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:f5e1585786ffa9276014521bef743c8b59c889cd28860b92d55c84cf6aab861a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a plan's fiscal year-end does not coincide with a month-end, the plan may measure investments and investment-related accounts (for example, a liability for a pending trade with a broker) using the month-end that is closest to the plan's fiscal year-end. That election shall be applied consistently from year to year. ##### [325-962-35-2](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:f13c587ea4ea01be39a9a9e5b0f966b234a19c99cb6d7facdc05c99a8256e343 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Some plan investments may not have [Level 1 inputs](https://asc.understandingaccounting.org/glossary/l/#level-1-inputs "Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.") to measure fair value. Therefore, they will need to be measured in accordance with the other valuation techniques described in Topic 820. Examples include all of the following: 1. a Real estate 2. b Mortgages or other loans 3. c Limited partnerships 4. d Restricted securities 5. e Unregistered securities 6. f Securities that are traded in inactive markets 7. g Nontransferable investment contracts. ##### [325-962-35-3](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:8efa8c1546c8543265d7d7f6d772cf8c294ea03fad5e03983424c2c23b972bea Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Both of the following are the obligation of the plan's trustees, the administrator, and the corporate trustee: 1. a To satisfy themselves that all appropriate factors relevant to the value of the investments have been considered 2. b To select a method to measure the fair value of the investments. ##### [325-962-35-4](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:aafade5caeff26b148d8e18311606a2c76e05098b85388e38a3f3814c0622f44 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. To the extent considered necessary, the plan may use the services of a specialist to assist the plan (or the administrators) in measuring the fair value of investments. Topic 820 provides guidance on how to measure fair value. #### Investment and Insurance Contracts ##### [325-962-35-5](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:f325c689a8cf988eb7dcb287be209bee4f73a1eee6a1f1b69ce1b7fcd8eaade8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Defined contribution plans, including both health and welfare and pension plans, shall report investments (including derivative contracts) at fair value (excluding insurance contracts and [fully benefit-responsive investment contracts](https://asc.understandingaccounting.org/glossary/f/#fully-benefit-responsive-investment-contract "An investment contract is considered fully benefit-responsive if all of the following criteria are met for that contract, analyzed on an individual basis: The investment contract is effected directly between the plan and the issuer and prohibits the plan from assigning or selling the contract or its proceeds to another party without the consent of the issuer. Either of the following conditions exists: The repayment of principal and interest credited to participants in the plan is a financial obligation of the issuer of the investment contract. Prospective interest crediting rate adjustments are provided to participants in the plan on a designated pool of investments held by the plan or the contract issuer, whereby a financially responsible third party, through a contract generally referred to as a wrapper, must provide assurance that the adjustments to the interest crediting rate will not result in a future interest crediting rate that is less than zero. If an event has occurred such that realization of full contract value for a particular investment contract is no longer probable (for example, a significant decline in creditworthiness of the contract issuer or wrapper provider), the investment contract shall no longer be considered fully benefit-responsive. The terms of the investment contract require all permitted participant-initiated transactions with the plan to occur at contract value with no conditions, limits, or restrictions. Permitted participant-initiated transactions are those transactions allowed by the plan, such as any of the following: Withdrawals for benefits Loans Transfers to other funds within the plan. An event that limits the ability of the plan to transact at contract value with the issuer and that also limits the ability of the plan to transact at contract value with the participants in the plan, such as any of the following, must be probable of not occurring: Premature termination of the contracts by the plan Plant closings Layoffs Plan termination Bankruptcy Mergers Early retirement incentives. The plan itself must allow participants reasonable access to their funds. If access to funds is substantially restricted by plan provisions, investment contracts held by those plans may not be considered to be fully benefit-responsive. For example, if plan participants are allowed access at contract value to all or a portion of their account balances only upon termination of their participation in the plan, it would not be considered reasonable access and, therefore, investment contracts held by that plan would generally not be deemed to be fully benefit-responsive. However, in plans with a single investment fund that allow reasonable access to assets by inactive participants, restrictions on access to assets by active participants consistent with the objective of the plan (for example, retirement or health and welfare benefits) will not affect the benefit responsiveness of the investment contracts held by those single-fund plans. Also, if a plan limits participants' access to their account balances to certain specified times during the plan year (for example, semiannually or quarterly) to control the administrative costs of the plan, that limitation generally would not affect the benefit responsiveness of the investment contracts held by that plan. In addition, administrative provisions that place short-term restrictions (for example, three or six months) on transfers to competing fixed-rate investment options to limit arbitrage among those investment options (equity wash provisions) would not affect a contract's benefit responsiveness.") \[see paragraph [962-325-35-6](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-6) for special provisions on the valuation of insurance contracts and paragraph [962-325-35-5A](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-5A) for special provisions on the valuation of fully benefit-responsive investment contracts\]). ##### [325-962-35-5A](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-5A) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:8f1b58875f4db51a60fd99fad944aa6faa9ae88fdf13b619e66ee99d14e1cdd5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Contract value is the relevant measure for the portion of the net assets available for benefits of a [defined contribution plan](https://asc.understandingaccounting.org/glossary/d/#defined-contribution-plan "A plan that provides an individual account for each participant and provides benefits that are based on all of the following: amounts contributed to the participant's account by the employer or employee; investment experience; and any forfeitures allocated to the account, less any administrative expenses charged to the plan. Defined contribution health and welfare plans—Defined contribution health and welfare plans maintain an individual account for each plan participant. They have terms that specify the means of determining the contributions to participants' accounts, rather than the amount of benefits the participants are to receive. The benefits a plan participant will receive are limited to the amount contributed to the participant's account, investment experience, expenses, and any forfeitures allocated to the participant's account. These plans also include flexible spending arrangements. Defined contribution postretirement plan—A plan that provides postretirement benefits in return for services rendered, provides an individual account for each plan participant, and specifies how contributions to the individual's account are to be determined rather than specifies the amount of benefits the individual is to receive. Under a defined contribution postretirement plan, the benefits a plan participant will receive depend solely on the amount contributed to the plan participant's account, the returns earned on investments of those contributions, and the forfeitures of other plan participants' benefits that may be allocated to that plan participant's account.") attributable to fully benefit-responsive investment contracts. ##### [325-962-35-6](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:e764f208ba999cbdf423b2d9ad4222bf5749b0e542e69ef587050b42349e2299 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Insurance contracts, as defined by Subtopic 944-20, shall be presented in the same manner as specified in the annual report filed by the plan with certain governmental agencies in accordance with the Employee Retirement Income Security Act; that is, either at fair value or at amounts determined by the insurance entity (contract value). Plans not subject to the Employee Retirement Income Security Act shall present insurance contracts as if the plans were subject to the reporting requirements of the Act. ##### [325-962-35-7](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:ec2c9ee98c08aa6f0c684df66f4d0c7faa04a58065febfc0f087f8e322257630 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [944-20-05-5 through 05-7](https://asc.understandingaccounting.org/asc/944/20/#944-20-05-5) for a discussion of the purpose, types, and a general characterization of insurance transactions. ##### [325-962-35-8](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:5e14c307caff4626ff819ca5af5ebb61e922715e0ce43c119017b25a34548e22 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [944-20-15-16 through 15-19](https://asc.understandingaccounting.org/asc/944/20/#944-20-15-16) for a discussion of certain types of insurance contracts, including long-duration contracts that do not subject the insurance entities to mortality or morbidity risks (investment contracts) and annuity contracts. #### Evaluation of Benefit Responsiveness ##### [325-962-35-9](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-9) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:735a718611d8937cefe6243beba623f575059c2e7cbe371aedcbd193be4ee277 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a plan holds multiple contracts, each contract shall be evaluated individually for benefit responsiveness. ##### [325-962-35-10](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-10) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:5ae1e5eaa44889ff3adc151f10ca55a9e827592fa4b023a3e1723b185f43ad9e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Contracts that provide for prospective interest adjustments may still be fully benefit-responsive provided that the terms of the contracts specify that the crediting interest rate cannot be less than zero. #### Application of Benefit Responsiveness ##### [325-962-35-11](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-11) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:4e05b91c496bde4ad3a953d5093ec419e5cbae26e13eca6a681d02925b841a57 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraphs [962-325-55-2 through 55-15](https://asc.understandingaccounting.org/asc/325/962/#325-962-55-2) include implementation guidance for the application of the definition of fully benefit-responsive for defined contribution plan investments. ##### [325-962-35-12](https://asc.understandingaccounting.org/asc/325/962/#325-962-35-12) Pending content: no Source downloaded (UTC): 2026-09-09T23:48:24.942Z to 2026-09-09T23:48:24.942Z Record version: sha256:23c0219bf0aa603ee7e6ea6cb1b081bb070f25ff608fa4c0f8f92072b1fabd28 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2015-12](https://asc.understandingaccounting.org/updates/asu-2015-12/) (Part I).