master trust interest

This Subtopic governs the form and content of the annual financial statements of a defined benefit pension plan. The overriding objective is to provide information useful in assessing the plan's present and future ability to pay benefits when due, with content focused on plan participants' needs (960-205-10-1 through 10-2). Annual statements must present net assets available for benefits, changes in those net assets, the actuarial present value of accumulated plan benefits, and the significant factors causing the year-to-year change in that actuarial present value (960-205-45-1).

This subtopic governs how a defined contribution pension plan presents its GAAP financial statements. On the accrual basis, the plan must present a statement of net assets available for benefits at plan year-end and a statement of changes in net assets available for benefits for the year, showing total assets, total liabilities, and net assets available for benefits, plus specified minimum categories of changes (net appreciation/depreciation in fair value, investment income, employer/participant/other contributions, benefits paid, insurance contract purchases, and administrative expenses). It also lists required note disclosures about the plan agreement, amendments, contribution basis, tax status, forfeitures, and similar matters.

ASC 325-960 (paralleling 960-325) governs how a defined benefit pension plan accounts for and reports its investments and insurance contracts. The core rule is that plan investments—equity and debt securities, real estate, and other assets other than insurance contracts—are presented at fair value at the reporting date, with purchases and sales generally recorded on a trade-date basis; insurance contracts are presented the same way as in the plan's ERISA filing (fair value or contract value). Extensive disclosure is required by general type of investment, including the plan's interest in a master trust.

ASC 962-325 governs how a defined contribution pension plan reports its investments and insurance contracts. The core rule is that plan investments (including derivatives) are reported at fair value under Topic 820, with two exceptions: fully benefit-responsive investment contracts are reported at contract value, and insurance contracts as defined in Subtopic 944-20 are presented the same way as in the plan's ERISA Form 5500 filing (fair value or contract value). It also prescribes trade-date recording, presentation of investments by general type, master trust disclosures, and disclosures about benefit-responsive contracts.

ASC 325-965 (parallel to 965-325) governs how health and welfare benefit plans measure, present, and disclose their investments and insurance contracts. The core rule is that plan investments are reported at fair value less costs to sell, if significant, at the financial statement date, except that insurance contracts are presented as reported in the plan's ERISA Form 5500 filing (fair value or contract value) and fully benefit-responsive investment contracts of defined contribution plans are measured at contract value. Presentation is by general type of investment, with specified disclosures for benefit-responsive contracts and for plan interests in master trusts.