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FASB ASC Guide > FASB ASC 962

The Financial Accounting Standards Board (FASB) released Accounting Standards Codification 962 (ASC 962) to address defined contribution pension plans. As plans which meet certain criteria must be separately audited, this can be an important code to follow to ensure compliance.

Defined contribution plans, while simpler than defined benefit plans, are still highly important for the employees receiving the benefit. From a company perspective, defined contribution plans are such because the company only contributes a certain dollar amount and then absolves responsibility for what happens to it after that. Employees usually elect how to invest these contributions and depending on investment performance, they may either be better or worse off than a defined benefit pension plan.

Check out more high level explanations of the FASB ASC in our Guide to the Accounting Standards Codification!

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