{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/325/965/#35-subsequent-measurement","source":"FASB Accounting Standards Codification, Basic View","usage":"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.","topic":"325","topic_title":"Investments—Other","subtopic":"325-965","subtopic_title":"Plan Accounting—Health and Welfare Benefit Plans","section":{"number":"35","label":"35 Subsequent Measurement","anchor":"35-subsequent-measurement","is_sec":false,"groups":[{"block":null,"heading":"Reporting at Fair Value","paragraphs":[{"citation":"325-965-35-1","para":"35-1","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AE05B-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Plan investments, whether they are in the form of equity or debt securities, real estate, or other investments </span></span> <span class=\"sfragment\" id=\"sfr_235AE1BC-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">(excluding insurance contracts and <a href=\"/glossary/f/#fully-benefit-responsive-investment-contract\" class=\"term\" title=\"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.\"><span>fully benefit-responsive investment contracts</span></a> [see paragraph <a href=\"/asc/325/965/#325-965-35-3\" class=\"xref\">965-325-35-3</a> for special provisions on the valuation of insurance contracts and paragraph <a href=\"/asc/325/965/#325-965-35-8\" class=\"xref\">965-325-35-8</a> for special provisions on the valuation of fully benefit-responsive investment contracts]), </span></span> <span class=\"sfragment\" id=\"sfr_235AE2C3-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">shall be reported at their <a href=\"/glossary/f/#fair-value\" class=\"term\" title=\"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.\"><span>fair value</span></a> less costs to sell, if significant, at the financial statement date. </span></span> </div> </div>","snippet":"Plan investments, whether they are in the form of equity or debt securities, real estate, or other investments (excluding insurance contracts and fully benefit-responsive investment contracts [see paragraph 965-325-35-3 …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5afe78c24fbef4b4d837e1603ea8105507f3e78d00958db197c5fc26d41dc3c8","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-1A","para":"35-1A","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AE394-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">If significant, the fair value of an investment shall be reduced by brokerage commissions and other costs normally incurred in a sale.</span></span> </div> </div>","snippet":"If significant, the fair value of an investment shall be reduced by brokerage commissions and other costs normally incurred in a sale.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b0446115217ef653ffbfa8cc9e00063a9f353514d7f43b278e959c7e75f50628","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-2","para":"35-2","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AE477-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Investment contracts held by defined benefit <a href=\"/glossary/h/#health-and-welfare-benefit-plans\" class=\"term\" title=\"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.\"><span>health and welfare benefit plans</span></a> shall be reported at their fair values. </span></span> </div> </div>","snippet":"Investment contracts held by defined benefit health and welfare benefit plans shall be reported at their fair values.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9eeaecf563b76431a24ebebf6f476249dd59fb42b2f0769cdcd4a445824b51c1","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-2A","para":"35-2A","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AE5B4-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">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.</span></span> </div> </div>","snippet":"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 cl…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:76c9d0dfa0ef7a32f86dea0bd4e4321007dc331d9cae676a3827eb9adf86a412","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8acf02354a03950fb14a107858c62e94f34554bde4f7e0d7a8d89c92f683fed6","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"block":null,"heading":"Insurance Contracts","paragraphs":[{"citation":"325-965-35-3","para":"35-3","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AE6B8-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Insurance contracts, as defined by Subtopic <a altsource=\"GUID-F4341DED-0F5B-433D-8291-11B4BCC32084.ditamap\" class=\"ditamap\">944-20</a>, shall be presented in the same manner as specified in the annual report filed by the plan with certain governmental agencies pursuant to 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. </span></span> </div> </div>","snippet":"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 pursuant to the Employee Retirement Income …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fbb53dbc3a51d439b7f714c2cd761af98d4aa7613c372ef3dff91ff94dd033bb","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-4","para":"35-4","html":"<div class=\"asc-body\"><div class=\"norm-text\">See paragraphs <div class=\"xref-range displayInline\"><a href=\"/asc/944/20/#944-20-05-5\" class=\"xref\">944-20-05-5 through 05-7</a></div> for a discussion of the purpose, types, and a general characterization of insurance transactions.</div> </div>","snippet":"See paragraphs 944-20-05-5 through 05-7 for a discussion of the purpose, types, and a general characterization of insurance transactions.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8d2325b88b0b609b7928ab0c967652509efb7a64a1fe17ead1411dd9b3348aa1","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-5","para":"35-5","html":"<div class=\"asc-body\"><div class=\"norm-text\">See paragraphs <div class=\"xref-range displayInline\"><a href=\"/asc/944/20/#944-20-15-16\" class=\"xref\">944-20-15-16 through 15-19</a></div> 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.</div> </div>","snippet":"See paragraphs 944-20-15-16 through 15-19 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…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6a81424095750edb631b9bb87e3d4ef08ae1c7dc202d68f93060f64ccf74249b","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c6fd3d4e305852ac920f296ac0522286796272934bdeb1faf73dccf21a79db05","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"block":null,"heading":"Investment Contracts","paragraphs":[{"citation":"325-965-35-6","para":"35-6","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AE7A9-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">If a plan holds multiple contracts, each contract shall be evaluated individually for benefit responsiveness. </span></span> <span class=\"sfragment\" id=\"sfr_235AE874-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">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. </span></span> </div> </div>","snippet":"If a plan holds multiple contracts, each contract shall be evaluated individually for benefit responsiveness. Contracts that provide for prospective interest adjustments may still be fully benefit-responsive provided tha…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:49c9bfb5c85eb37c953c00f413832eb62cc121af32d71e84fcc8a0ed429ffedd","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-7","para":"35-7","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AE94E-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Section <a altsource=\"GUID-DF857C9F-B563-4EFA-BB7E-15481387624B.ditamap\" class=\"ditamap\">965-325-55</a> includes implementation guidance for the application of the definition of fully benefit-responsive for defined contribution health and welfare plan investments. </span></span> </div> </div>","snippet":"Section 965-325-55 includes implementation guidance for the application of the definition of fully benefit-responsive for defined contribution health and welfare plan investments.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:53d6aa5951e244eb710e272204a0d8307095cd8edf9505bce0032c855e75f259","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-8","para":"35-8","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <span class=\"sfragment\" id=\"sfr_235AEA1D-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Contract value is the relevant measure for the portion of the net assets available for benefits of a defined contribution health and welfare benefit plan attributable to fully benefit-responsive investment contracts. </span></span> </div> </div>","snippet":"Contract value is the relevant measure for the portion of the net assets available for benefits of a defined contribution health and welfare benefit plan attributable to fully benefit-responsive investment contracts.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:74e27bd2f4cf51292eeec59b1143e55d8d90027c21c914fd8c3dbd3c65a58fba","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}},{"citation":"325-965-35-9","para":"35-9","html":"<div class=\"asc-body\"><div class=\"norm-text\"> <a href=\"/updates/asu-2015-12/\" class=\"xref\">Paragraph superseded by Accounting Standards Update No. 2015-12</a> (Part I).</div> </div>","snippet":"Paragraph superseded by Accounting Standards Update No. 2015-12 (Part I).","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7425261792dbcc776382a8c223984c6fced2b30d04430030fc1abb0fd14cd400","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479182","source_sha256":"62ca736da6609c1a87d6e41e3b8f22c8c14e7af4a903ef9360a5a8eba96f5d1f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7f4d27bae3043e106919da506ade46d761a03735b0f2593045d98cc5ac1f3c38","downloaded_from":"2026-09-09T23:48:49.384Z","last_downloaded_at":"2026-09-09T23:48:49.384Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not 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