Unformatted text preview: 7-8 (a) An investment trust fund is appropriate for the external portion of a multigovernment investment pool maintained by a government. (b) Only the external portion of investments should be included in an investment trust fund. Any internal portion of investments should be excluded from the investment trust fund. (c) Investments should be reported at fair value in an investment trust fund. (d) Both realized and unrealized gains and losses on investments are to be reported as one item in the financial statements. It is not appropriate to report realized and unrealized gains and losses seperately, however the amount of realized gains or losses can be included in the disclosure notes. (e) Investment trust funds are considered fiduciary funds and they are reported in the Statement of Fiduciary Net Assets and the Statement of Changes in Fiduciary Net Assets. 7-10 The required statements for a pension trust fund are the Statement of Plan Net Assets and the Statement of Changes in Plan Net Assets. The required supplementary information schedules for a pension trust fund are the Schedule of Funding Progress and the Schedule of Employer Contributions. 7-11 (a) A defined contribution plan pays out only the amount accumulated for each employee. A defined benefit plan pays out a certain level of benefits no matter how much is accumulated and available. (b) With an agency plan each employer has a seperate account and is responsible for keeping their contributions up to date. Cost-sharing plans are statewide and all employers share an account, this means that deficiencies are recovered on a state-wide basis and all employers are charged extra to make up for this. (c) The annual required contribution is the amount required by a retirement fund to be contributed, this includes normal cost and funding of past service cost. The annual required contributions is used in the schedule of employer contributions. Net pension obligation is the accumulated difference between the employer's required and actual contributions in a pension plan. (d) Agent multiemployer plans report expenditures/expenses based on the calculation prepared for the specific employer whereas cost-sharing plans report expenditures/expenses based on calculations prepared on a statewide basis. (e) For general government employees, the pension expenditures would be reported in the general fund and the amount would be limited to the amount of financial resources available to pay them. Any difference between the recognized expenditure and the actual pension cost would be added to the net pension obligation. For enterprise fund employees, pension expenses would be reported as fund expenses and the net pension obligation is reported as a fund liability. ...
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- Spring '11
- Finance, Cash balance plan, fiduciary net assets, Investment Trust Fund