Pension Benefits And Benefits Of Pensions

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The topic to be discussed in this research paper is that of pensions. Pensions are an important topic in the field of accounting due to all the specific accounting methods and procedures that go along with them as well as the fact that pensions are so widely used and can make up a large part of a company’s expenses. Within the topic of pensions to be covered in this paper fall the concepts of the types of pension plans, pension obligations and plan assets, pension expense, as well as various reporting issues. Pensions Pensions are a benefit that many employees receive from their employers and come in the form of compensation that is received after they are retired (Spiceland, Sepe, & Nelson, 2013). Because these pension benefits are a type of deferred compensation, there are certain ways that these benefits must be accounted for. This means that pension benefits are recognized as they are earned through an accrual basis. Aside from companies providing pension plans, people sometimes also invest in things such as IRAs, stocks, and bonds to create their own personal pension funds. The reason that many companies offer pension plans is due to the fact that they can help provide a sense of security for employees, increase employee satisfaction, or sometimes so that the company can compete better in the labor market (Spiceland et al., 2013). Types of Pension Plans Within the concept of pension plans fall two different types of pension plans: defined contribution pension plans

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