Accounting for Actuarial Gains and Losses

A company has adopted TFRS for NPAEs and recognises the employee benefits obligation based on calculations performed by a qualified actuary using the projected unit credit method.

Keywords: Mazars, Thailand, Accounting, FAP, TFRS, NPAEs, Actuarial Valuation Report

17 September 2014

During the year, the Actuarial Valuation Report indicated that the company has an actuarial gain arising on the defined benefit obligation.

How should the company record the gain arising from the difference between actuarial assumptions in the financial statements?

The Federation of Accounting Professions (FAP) has issued a guideline stating that a company that has determined its employee benefits obligation based on calculations performed by a qualified actuary using the projected unit credit method is recognising a “best estimate”in accordance with TFRS for NPAEs paragraph 311.

Therefore, the Company has to recognise the actuarial gain in the statement of income. The same treatment would be applied should there have been an actuarial loss in the year.

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