The Main Difference Between The ABO And PBO Is The Salary ...

Home » What Is Projected Benefit Obligation » The Main Difference Between The ABO And PBO Is The Salary ...

Maybe your like

Skip to content Facebook-f Linkedin-in Youtube Instagram

LOGIN

Start Trial
  • Products
  • Pricing
  • Partnerships
  • Company Close Company Open Company
    Company Overview
    • About Us
    • CPA Study Groups
    • Partnerships
    • Student Reviews
    Universal CPA Review is a great resource for those who may struggle with retaining information from other platforms due to their images and visual learning approach. Jennifer G Read More Reviews
  • Resources Close Resources Open Resources
    Strategy and Planning
    • Blog
    • FAQ
    • Compare Universal CPA Review
    • Switch To Universal
    • Scholarship
    • Financing
    Exam Resources
    • CPA Exam Pass Rates
    • CPA Exam Score Release
    • CPA Evolution
    • AICPA Sample Test
    • CPA Exam Study Guide
    • Free CPA Classes
    • Ask Joey™
    Join The General CPA Exam Study Group

    9,000+ CPA candidates are members!

    »
    Join The FAR Study Group

    4,500+ CPA candidates are members!

    Join The AUD Study Group

    2,300+ CPA candidates are members!

    Join The REG Study Group

    2,700+ CPA candidates are members!

    Join The BEC Study Group

    2,500+ CPA candidates are members!

Login Try for Free Your Ask Joey ™ Answer Back To Questions Related FAQ's
  • Free Mental Maps – PDF
  • What is a Journal Entry?
  • CPA Evolution Survival Guide
  • CECL Excel Workbook
  • Variance Analysis Excel Workbook
  • Equity Method Excel Workbook
  • How to calculate cash to accrual adjustment for deferred revenue?
  • How to interpret the breakeven point in units?
  • What is target costing?
  • What is capital rationing?
What is the main difference between the accumulated benefit obligation (ABO) and the projected benefit obligation (PBO)?

The main difference between the ABO and PBO is the salary information used to estimate the obligation. The ABO uses current salary information while the PBO uses projected compensation at retirement.

Previous Question Next Question Back To All Questions

You might also be interested in...

  • How do actuarial gains and losses impact the pension benefit obligation?

    As you can see in the visual below, actuarial gains decrease the PBO while losses increase the PBO. Actuarial gains and losses typically arise when the actuary changes the estimates used to calculate the PBO.

    Read More

  • How to calculate the project benefit obligation?

    Basically, you need to roll forward the obligation balance from the beginning of the year (i.e. which equals end of prior year), and then factor in the items listed in the rollforward below. That will get you to your ending PBO, and that is what is recorded on the balance sheet as the ending liability (can be split into current and non-current). For example, if Gary had a beginning PBO of $230,000, service costs of $15,000, benefits paid of $19,000, interest costs of $12,000 and actuarial losses of $5,000, then the ending PBO would be $243,000.

    Read More

  • How do you calculate the funded status of a postretirement benefit obligation?

    Calculating the funded status of a postretirement benefit obligation involves comparing the accumulated postretirement benefit obligation (APBO) to the fair market value of the plan assets. If the plan assets is greater than the APBO, then the plan is overfunded and would be recorded as a non-current asset. If the plan assets are less than the APBO, then the plan is underfunded, and would be recorded as a current or non-current liability. The rules for postretirement benefit obligations are very similar to pensions. For example, if Park City had plan assets of $950,000 and the accumulated postretirement benefit obligation was $1,000,000, the plan would be underfunded by $50,000.

    Read More

START A FREE 7-DAY TRIAL TODAY!

START FREE TRIAL NOW

Universal CPA is a visual learning platform that was developed by CPA's to teach future CPA's!

© 2022 Universal CPA Review. All Rights Reserved.

Tag » What Is Projected Benefit Obligation