{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/715/958/#55-implementation-guidance-and-illustrations","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":"715","topic_title":"Compensation—Retirement Benefits","subtopic":"715-958","subtopic_title":"Not-for-Profit Entities","section":{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"715-958-55-1","para":"55-1","html":"
This Section, which is an integral part of the requirements of this Subtopic, provides general guidance to be used by a not-for-profit entity (NFP) in reporting its retirement benefit plans.
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For reporting by a not-for-profit entity (NFP) that has a defined benefit pension plan that covers employees at the national and all local chapters to which each chapter is required to contribute based on a predetermined formula and for which plan assets are not segregated or restricted on a chapter-by-chapter basis, see paragraph 715-30-55-63.
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This Example illustrates the guidance in Sections 958-715-35 and 958-715-45.
","snippet":"This Example illustrates the guidance in Sections 958-715-35 and 958-715-45.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cc37ab79212224abba8fc9b32eb4bab52e0e0abe59d4b13c52be8a446beb30b3","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}},{"citation":"715-958-55-4","para":"55-4","html":"
Not-for-Profit Entity A's (NFP A's) actuary prepares a 12-month projection of net periodic pension cost for July 1, 20X7, to June 30, 20X8. The funded status of NFP A's defined benefit pension plan as of June 30, 20X7, and June 30, 20X8, and amounts to be recognized as components of net periodic pension cost are shown in paragraph 958-715-55-5. The cumulative net loss not yet recognized as a component of net periodic pension cost is less than 10 percent of the greater of the projected benefit obligation and the market-related value of plan assets. No plan amendments affect the period from July 1, 20X7, to June 30, 20X8. Assumptions about benefit payments and contributions made by NFP A have not been included in this Example. During the fiscal year ending June 30, 20X8, NFP A does the following:
  1. a
    Recognizes the additional net loss as a change in net assets without donor restrictions and a change in the liability that reflects the underfunded status of the plan
  2. b
    Recognizes the amortization of the transition obligation as a component of net periodic pension cost
  3. c
    Recognizes the amortization of prior service cost as a component of net periodic pension cost
  4. d
    Recognizes net periodic pension cost within the appropriate functional expense categories for 20X8, with the service cost component reported as part of the intermediate measure of operations (for example, increase in net assets from operating activities) and the other components reported in a separate line item, outside the intermediate measure of operations presented by NFP A, within changes in net assets without donor restrictions.
","snippet":"Not-for-Profit Entity A's (NFP A's) actuary prepares a 12-month projection of net periodic pension cost for July 1, 20X7, to June 30, 20X8. The funded status of NFP A's defined benefit pension plan as of June 30, 20X7, a…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:34c8f8d9f85a3bf2f1d0d38d13ad4b71bc6db14a0ead98974d55c92439a7ba08","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}},{"citation":"715-958-55-5","para":"55-5","html":"
These facts are illustrated in the following table.
","snippet":"These facts are illustrated in the following table.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:24808ecec820749f9a9513de91ce82cc2c956fe6dcdf159845bbe4d35e66c43b","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}},{"citation":"715-958-55-6","para":"55-6","html":"
For the year ending June 30, 20X8, NFP A recognizes the amortizations of the transition obligation and prior service cost as components of net periodic pension cost and recognizes the additional loss arising during the year. The journal entries are as follows:
  1. a
    Recognize the additional loss in net assets without donor restrictions.
    • Net loss not yet recognized in net periodic pension cost 50 Liability for pension benefits 50
  2. b
    Recognize the amortization of the transition obligation in net periodic pension cost.
    • \"Net periodic pension cost—transition obligation (functionalized)\" 40 Transition obligation not yet recognized in net periodic pension cost 40
  3. c
    Recognize the amortization of prior service cost in net periodic pension cost.
    • \"Net periodic pension cost—prior service cost (functionalized)\" 100 \"Prior service cost not yet recognized in net periodic pension cost\" 100
  4. d
    Recognize service cost separately and recognize the interest cost and the expected return on plan assets together in net periodic pension cost.
    • Net periodic pension cost—service cost (functionalized) 110 Net periodic pension cost—interest cost and expected return on plan assets (functionalized) 5\t(b) Liability for pension benefits 105 \"(a) Footnote superseded. \" (b) Equals $120 interest cost - $125 expected return on plan assets.
In its statement of activities, NFP A presents the service cost component by appropriate functional expense categories within the intermediate measure of operations (for example, increase in net assets from operating activities), within changes in net assets without donor restrictions, and presents the other components (encompassing the interest cost, the expected return on plan assets, and the amortizations of the transition obligation and prior service cost) in a separate line item (different from the separate line item discussed below for the items not yet recognized as components of net periodic pension cost) outside the intermediate measure of operations, within changes in net assets without donor restrictions. NFP A presents in a separate line item, outside the intermediate measure of operations, within changes in net assets without donor restrictions, the items (encompassing the net loss arising during the year and the changes in the transition obligation and prior service cost) not yet recognized as components of net periodic pension cost. NFP A would disclose, in the notes to financial statements, the information required by paragraph 958-715-50-1. NFP A also would disclose, in the notes to financial statements, an analysis of all expenses (including the service cost component and the other components of net periodic pension cost) by their nature and function in accordance with paragraphs 958-720-45-2 and 958-720-45-15.
","snippet":"For the year ending June 30, 20X8, NFP A recognizes the amortizations of the transition obligation and prior service cost as components of net periodic pension cost and recognizes the additional loss arising during the y…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:dcbc81bdb4f6ee51c4ef2cbd33234f3c4ede645997eb169ce14cddee9d943f6e","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}},{"citation":"715-958-55-7","para":"55-7","html":"
The following statement of activities reflects how NFP A presents the service cost component and the other components of net periodic pension cost and the items not yet recognized as components of net periodic pension cost in its statement of activities, which presents an intermediate measure of operations.
","snippet":"The following statement of activities reflects how NFP A presents the service cost component and the other components of net periodic pension cost and the items not yet recognized as components of net periodic pension co…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:45a825b8f2def05ef2614e405f6bdfb484d48c50e7e36e98e71ccde36dd9d1b0","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}},{"citation":"715-958-55-8","para":"55-8","html":"
Paragraph superseded by Accounting Standards Update No. 2017-07.
","snippet":"Paragraph superseded by Accounting Standards Update No. 2017-07.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5c3e005e1774f3c7875c1162f20fbeac13b581ea72a3f5022ae2000ebe879433","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:229a2033bd083ef595c128257bc1e43c15b56d074b655bbed33950e712953541","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:51b921576256993641c7ed34c33801f762052eb45b3d27d7a4ab7ccf8c912006","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:51b921576256993641c7ed34c33801f762052eb45b3d27d7a4ab7ccf8c912006","downloaded_from":"2026-09-10T01:02:44.737Z","last_downloaded_at":"2026-09-10T01:02:44.737Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478498","source_sha256":"0c798ed8c2338769a28e77b814a2e21c5c8c1deebb57f952a860262f3018e2b7"}}