Post-employment Benefits Accounting Treatment

Easy Employee Compensation Post-employment Benefits

In the context of financial reporting, companies often have various post-employment benefits that are provided to employees after they retire. These benefits can significantly affect a company's financial statements due to their long-term nature and accounting complexities.

Which of the following statements best describes the accounting treatment for a defined benefit pension plan under IAS 19?

The employer recognizes the cost of the defined benefit obligation when the plan is funded.

The employer recognizes and measures the defined benefit obligation at the present value of the expected future payments.

The employer records the pension expense only when an employee retires.

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