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FASB strikes again!

The Financial Accounting Standards Board (FASB) is considering requiring corporations to provide more details about pension plan allocations, including alternative investments. FASB says it is responding to shareholder demands for more transparency so they can better gauge portfolio risks.

By Staff Writer | Updated on February 19, 2008

The Financial Accounting Standards Board (FASB) is considering requiring corporations to provide more details about pension plan allocations, including alternative investments. FASB says it is responding to shareholder demands for more transparency so they can better gauge portfolio risks. At a meeting Feb. 13, the FASB board directed staff members to draw up proposed amendments to FAS 132 (Employers’ Disclosures about Pensions and other Post-Retirement Benefits) that would compel companies to list pension fund assets by categories, such as stocks, bonds and alternative investments, such as collateralized debt obligations (CDOs).

The increased use of alternative investments raised user concerns that “current disclosures of plan assets are not detailed enough to determine what types of assets are held in post-retirement benefit plans,” according to a FASB staff memo. “Disclosure of more specific asset categories would enable users to better assess the timing, uncertainty and amount of future cash flows related to an increase or decrease in the value of plan assets.”

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