The impact of SFAS 88 transactions: puff or economic reality?

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Date: Oct. 1991
From: The CPA Journal(Vol. 61, Issue 10)
Publisher: New York State Society of Certified Public Accountants
Document Type: Article
Length: 2,343 words

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Abstract :

Corporate financial statements containing substantial off-balance sheet amounts, such as unamortized projected benefit obligation and transition amounts, unamortized gains and losses, and unamortized prior service costs, have utilized discretion available under the Statement of Financial Accounting Standards Number 88 (SFAS 88) to substantially augment reported profits of a company. Companies have been utilizing SFAS 88 to increase reported earnings even when such gains do not result in reversions of cash for the firm's over-funded pension plans. Termination of employees, under SFAS 88, allows for the charging of termination benefits as reflected from the time when the termination offer was accepted by the employee, as long as a fairly estimable amount can be made. Curtailment and settlement transactions were surveyed in terms of termination benefits accounted for under SFAS 88.

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Gale Document Number: GALE|A11583337