{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/960/20/#25-recognition","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":"960","topic_title":"Plan Accounting—Defined Benefit Pension Plans","subtopic":"960-20","subtopic_title":"Accumulated Plan Benefits","section":{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":null,"heading":"Application of Plan Provisions","paragraphs":[{"citation":"960-20-25-1","para":"25-1","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_1951B0DD-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\"><a href=\"/glossary/b/#benefit-information\" class=\"term\" title=\"The actuarial present value of accumulated plan benefits.\"><span>Benefit information</span></a> shall relate to the <a href=\"/glossary/b/#benefits\" class=\"term\" title=\"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.\"><span>benefits</span></a> reasonably expected to be paid in exchange for <a href=\"/glossary/e/#employee\" class=\"term\" title=\"A person who has rendered or is presently rendering service.\"><span>employees'</span></a> <a href=\"/glossary/s/#service\" class=\"term\" title=\"Employment taken into consideration under a pension plan. Years of employment before the inception of a plan constitute an employee's past service; years thereafter are classified in relation to the particular actuarial valuation being made or discussed. Years of employment (including past service) before the date of a particular valuation constitute prior service; years of employment following the date of the valuation constitute future service; a year of employment adjacent to the date of valuation, or in which such date falls, constitutes current service.\"><span>service</span></a> to the <a href=\"/glossary/b/#benefit-information-date\" class=\"term\" title=\"The date as of which the actuarial present value of accumulated plan benefits is presented.\"><span>benefit information date</span></a>. </span></span></div></div>","snippet":"Benefit information shall relate to the benefits reasonably expected to be paid in exchange for employees' service to the benefit information date.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:29f9b4ef32fab7431682275b3348ac8e23e64c948012720bfc58138c65c54e62","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}},{"citation":"960-20-25-2","para":"25-2","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_1951B28B-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">The following best represent the benefits attributable to service already rendered: </span></span><ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\"><a href=\"/glossary/v/#vested-benefits\" class=\"term\" title=\"Benefits for which the employee's right to receive a present or future pension benefit is no longer contingent on remaining in the service of the employer. (Other conditions, such as inadequacy of the pension fund, may prevent the employee from receiving the vested benefit.) Under graded vesting, the initial vested right may be to receive in the future a stated percentage of a pension based on the number of years of accumulated credited service; thereafter, the percentage may increase with the number of years of service or of age until the right to receive the entire benefit has vested.\"><span>Vested benefits</span></a></div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951B39A-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Nonvested benefits expected to become vested, determined primarily in accordance with the benefit accrual provision </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">c</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951B4E4-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Employees' history of pay and service to the benefit information date. </span></span></div></li></ol></div></div>","snippet":"The following best represent the benefits attributable to service already rendered:\n(a) Vested benefits\n(b) Nonvested benefits expected to become vested, determined primarily in accordance with the benefit accrual provis…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6ed96aadf3b1ad3ed135ac1a593b3c707b5e8d871b133f130fe07775b87cdff1","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}},{"citation":"960-20-25-3","para":"25-3","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_1951B5CD-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">To the extent possible, plan provisions shall apply in recognizing <a href=\"/glossary/a/#accumulated-plan-benefits\" class=\"term\" title=\"Future benefit payments that are attributable under the provisions of a pension plan to employees' service rendered to the benefit information date. Accumulated plan benefits comprise benefits expected to be paid to any of the following: Retired or terminated employees or their beneficiaries Beneficiaries of deceased employees Present employees or their beneficiaries.\"><span>accumulated plan benefits</span></a>. </span></span><span class=\"sfragment\" id=\"sfr_1951B6B1-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">In some plans, benefits are a specified amount for each year of service. </span></span><span class=\"sfragment\" id=\"sfr_1951B78B-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Even if a plan does not specify a benefit for each year of service, another of its provisions (for example, a provision applicable to terminated employees or to termination of the plan—if independent of funding patterns) may indicate how to measure accumulated plan benefits. </span></span></div></div>","snippet":"To the extent possible, plan provisions shall apply in recognizing accumulated plan benefits. In some plans, benefits are a specified amount for each year of service. Even if a plan does not specify a benefit for each ye…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:415af098a262ec4d74c731e510f0f43753f59a7b85ad2b688d4051417933dc32","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}},{"citation":"960-20-25-4","para":"25-4","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_1951B874-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">If the benefit for each year of service is not stated by or clearly determinable from the provisions of the plan, the benefit shall be considered to accumulate in proportion to either of the following: </span></span><ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951B94E-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">The ratio of the number of years of service completed to the benefit information date to the number that will have been completed when the benefit will first be fully vested, if the type of benefit is includable in vested benefits (for example, a supplemental early retirement benefit that is a vested benefit after a stated number of years of service) </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951BA23-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">The ratio of completed years of service to projected years of service upon anticipated separation from covered employment, if the type of benefit is not includable in vested benefits (for example, a death or disability benefit that is payable only if death or disability occurs during active service). </span></span></div></li></ol></div></div>","snippet":"If the benefit for each year of service is not stated by or clearly determinable from the provisions of the plan, the benefit shall be considered to accumulate in proportion to either of the following:\n(a) The ratio of t…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f78bc101466aca82a2c2ab66ab2c1b380ee22833502f4a1916e3a53657cd57c1","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}},{"citation":"960-20-25-5","para":"25-5","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_1951BAFC-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">In recognizing and measuring accumulated plan benefits, the following shall apply: </span></span><ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951BBCE-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Except as indicated in (b) and (c) of this paragraph, accumulated plan benefits shall be based on employees' history of pay and service and other appropriate factors as of the benefit information date. </span></span><span class=\"sfragment\" id=\"sfr_1951BC97-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">An illustration of the application of this guidance appears in Example 1 (see paragraph <a href=\"/asc/960/20/#960-20-55-6\" class=\"xref\">960-20-55-6</a>). </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951BD6B-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Projected years of service shall be a factor only in determining employees' expected eligibility for particular benefits, such as any of the following: </span></span></div><ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">1</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951BE44-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Increased benefits that are granted provided a specified number of years of service are rendered (for example, a pension benefit that is increased from $9 per month to $10 per month for each year of service if 20 or more years of service are rendered) </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">2</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951BF0B-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Early retirement benefits </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">3</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951BFCD-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Death benefits </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">4</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951C09C-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Disability benefits. </span></span></div></li></ol></li><li class=\"li-norm\"><span class=\"linum\">c</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951C162-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Automatic benefit increases specified by the plan (for example, automatic cost-of-living increases) that are expected to occur after the benefit information date shall be recognized. </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">d</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951C233-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Benefits to be provided by means of contracts excluded from <a href=\"/glossary/p/#plan-assets\" class=\"term\" title=\"Assets—usually stocks, bonds, and other investments—that have been segregated and restricted, usually in a trust, to provide for pension benefits. The amount of plan assets includes amounts contributed by the employer, and by employees for a contributory plan, and amounts earned from investing the contributions, less benefits paid. 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. 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 it may be intended that such assets be used to provide pensions. If a plan has liabilities other than for benefits, those nonbenefit obligations may be considered as reductions of plan assets. Amounts accrued by the employer but not yet paid to the plan are not plan assets. Securities of the employer held by the plan are includable in plan assets provided they are transferable.\"><span>plan assets</span></a> for which payments to the insurance entity have been made shall be excluded. </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">e</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951C2F0-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Plan amendments adopted after the benefit information date shall not be recognized. </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">f</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_1951C3B7-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">If it is necessary to take future compensation into account in the determination of Social Security benefits, employees' compensation as of the benefit information date shall be assumed to remain unchanged during their assumed future service. Increases in the wage base or benefit level pursuant to either the existing Social Security law or possible future amendments of the law shall not be recognized. </span></span></div></li></ol></div></div>","snippet":"In recognizing and measuring accumulated plan benefits, the following shall apply:\n(a) Except as indicated in (b) and (c) of this paragraph, accumulated plan benefits shall be based on employees' history of pay and servi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1572961f13bc028c29fe32c9a102556cf5b1910de48658eb724048e4dc9f82d4","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}},{"citation":"960-20-25-6","para":"25-6","html":"<div class=\"asc-body\"><div class=\"norm-text\"><a href=\"/updates/page-1833002/\" class=\"xref\">Superseded by Notice to Constituents</a>.</div></div>","snippet":"Superseded by Notice to Constituents.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0e92b46346017ebae7434990e06e63834d4e6f47b46815b2a071158c658979e8","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:730e41cc775a3c099385b12007d19d0f63534ac8ca0bbf08cd5d0ed96495784a","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:362bb74c2f88e9b7695437d2d54ed93b4b0c16b13fd511884f1bd5093ff2df2b","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:362bb74c2f88e9b7695437d2d54ed93b4b0c16b13fd511884f1bd5093ff2df2b","downloaded_from":"2026-09-10T02:22:48.507Z","last_downloaded_at":"2026-09-10T02:22:48.507Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481134","source_sha256":"ae731771da6a4a88cc1e26a8174925874a3da718977bca7d7ab12eb64eb16df9"}}