# ASC 962-10-05: Plan Accounting—Defined Contribution Pension Plans — Overall — 05 Overview and Background Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/962/10/#05-overview-and-background) 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): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:48d2c457851ada2060568d934c68ed16ce7ed52d8f6e669d01be594e8db6a3aa Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 962-10-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/962/10/#05-overview-and-background) SEC content: no ##### [962-10-05-1](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:4b3e07c489c46a4fcebfca26cc6640e07c609a283b27b88466e2e6a1f6d30687 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Codification contains several Topics for the accounting and reporting by a plan (as opposed to an employer) due to the differing accounting treatment for various forms of employee benefit plans. The Compensation Topics address the accounting and reporting by the employer. The Plan Accounting Topics include: 1. a Plan Accounting—Defined Benefit Pension Plans, Topic 960 2. b Plan Accounting—Defined Contribution Pension Plans, (this Topic) 3. c Plan Accounting—Health and Welfare Benefit Plans, Topic 965. Additionally, Topic 715 addresses financial accounting and reporting for an employer that offers pension, other postretirement, and certain special or contractual termination [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.") to its employees. ##### [962-10-05-2](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:bbdae34674be856cbf6468f9c853f6ef400043062030e1a50dce5ed8524af53f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Plan Accounting—Defined Contribution Pension Plans Topic includes the following Subtopics: 1. a Overall 2. b Terminating Plans 3. c Presentation of Financial Statements 4. d Notes to Financial Statements 5. e Receivables 6. f Investments—Other. ##### [962-10-05-3](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:09339ec1e0ff84693866548a23253fa1e639c6bbc498d42b5e2eaa15cf69ceba Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Overall Subtopic provides guidance on the accounting and reporting for defined contribution pension plans. ##### [962-10-05-4](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:470c7da0f3b7b8bd59e1c378ef65fced3c4057d3cdfc842bbc4d5c68fe49d854 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Information relevant to the primary users of [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.") financial statements—plan participants—is different from that which is relevant to users of defined benefit plan financial statements. In defined contribution plans, plan participants have a greater vested interest in monitoring the financial condition and operations of the plan since they bear investment risk under these plans and plan transactions can directly affect their benefits. ##### [962-10-05-5](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:06e5aaeb5630658a95d74c7d1c4dd696baf44dd74dc446f9d980e68dce9954f9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Consistent with the objective of a defined contribution plan's financial statements, net assets available for benefits of defined contribution plans should be measured and reported at values that are meaningful to financial statement users. ##### [962-10-05-6](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:78f453421d438d96119031588fdf7249a01cfdb52057ff85a1f5e1b116383df0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Information that is useful to plan participants includes the amount they would receive currently if they were to withdraw or borrow funds from or transfer funds within the plan. ##### [962-10-05-7](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:34e17d4b1efd51f55d55989a11e9dedf23de07752d729c4756ced16967811c99 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The primary users of a defined contribution plan's financial statements include all of the following: 1. a Plan [sponsor(s)](https://asc.understandingaccounting.org/glossary/s/#sponsor "In the case of a pension plan established or maintained by a single employer, the employer; in the case of a plan established or maintained by an employee entity, the employee entity; in the case of a plan established or maintained jointly by two or more employers or by one or more employers and one or more employee entities, the association, committee, joint board of trustees, or other group of representatives of the parties that have established or that maintain the pension plan.") 2. b Plan participants 3. c The following governmental regulators: 1. 1 The U.S. Department of Labor 2. 2 The Internal Revenue Service (IRS) 3. 3 The Securities and Exchange Commission (SEC). #### The Employee Retirement Income Security Act of 1974 ##### [962-10-05-8](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:ffb548129742d6c15b1759f86d8252fdd9901d251f211baf8bc49d8e7ed75529 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Defined contribution pension plans are generally subject to certain of the reporting and other requirements of The Employee Retirement Income Security Act of 1974. In addition to establishing certain minimum standards for participation, vesting, and funding for employee benefit plans of private entities, the Act also requires annual reporting of certain information to particular governmental agencies and summarized information to plan participants. For many plans, the reporting requirements include financial statements prepared in conformity with generally accepted accounting principles (GAAP). ##### [962-10-05-9](https://asc.understandingaccounting.org/asc/962/10/#962-10-05-9) Pending content: no Source downloaded (UTC): 2026-09-10T02:23:53.436Z to 2026-09-10T02:23:53.436Z Record version: sha256:2a5d48c120d46ecd0bfc75610accbc1e822a4700492f6030ce51c63f89f99e28 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The reporting requirements of the Act, except for certain particular references, are not included in the Codification, but they should nonetheless be considered by those responsible for the preparation of defined contribution plan financial statements.