David M. Katz, CFO.com | US
June 6, 2006

FASB Clearly Went Overboard

It was not surprising to see that FASB didn't appropriately reflect the financial reality of the pension plan in its recent exposure draft. After all, FASB's very existence today depends on its bending over backwards to reflect what it perceives to be SEC's post-Enron marching orders. To their credit, however, many both on the corporate and on the consulting sides seem to understand that FASB went overboard in its proposal. Amazing how far FASB has gone to force pension plans out of existence when there is little (if any) evidence that financial statements have been distorted under the current accounting regime. The FASB proposal will distort financial statements a whole lot more for the few companies that will still have pension plans after FASB is done with them. Remember that the pension plan was the only "silver lining" for the employees of Enron.

Posted by NEVILLE ARJANI | Jun 9, 2006 10:09 AM ET

And the Anser is......

Instead of lamenting about complicated reporting and time frames, the management and boards of these companies should show some guts and freeze all these defined benefit plans and replace them with 401K's, period.
Then they can fund the known benefits over a rational period and be done with these arcane vehicles that satify no one.

Posted by GARY CADEMARTORI | Jun 7, 2006 3:36 PM ET

Executives' Letters Rip FASB Pension Draft

Finally, the gloves are coming off and sanity may prevail.

Thanks for the article. This may drive additional comments to get FASB to rethink and reschedule their rollout of the draft.

Posted by Bill Bettag | Jun 7, 2006 1:44 PM ET