An FRA question is driving me nuts. This is based on IFRS.

If TPPC - Periodic Pension Cost in P&L = PPC in OCI

And I’m asked to solve for P&L in OCI using the data below,

I could either solve for P&L in OCI by calculating it directly, or calculate PPC in P&L and subtract it from TPPC.

The solution is calculating P&L in OCI directly, which I couldn’t remember, but figured I could solve using my method.

But, I’m not coming up with the correct solution. Can someone help show me how my logic of solving via TPPC minus Pension Cost in P&L is flawed? Or how I calculate Pension Cost in P&L correctly, as I am missing something here… Thank you.

DATA:

TPPC = $585.8 million

Employer Contributions = 75.5

Current Service Cost = 57.4

Plan Amendments = (189)

Actuarial Gain = 274.7

Plan Assets @ Start of Year = 4,038

Plan Assets @ End of Year = 3,307.50

PBO @ Start of Year = $3,651.9

PBO @ End of Year = $3,431.70

Actual Return on Plan Assets = -18.6%

Discount Rate = 6.6%

PPC in the P&L would be:

Current Service Cost

(+) Past Service Cost

(+) Net Interest Cost

= Pension Expense Reported in P&L

SOLUTION: The answer to the above problem is a loss of $742.9 reported in the OCI.

This is equal to the Actuarial Gain of $274.7 less Net Return on Plan Assets: Actual Return less Expected Return x Plan Assets @ Beginning of Year = -18.6% minus 6.6% = -25.2% x $4,038 = -1,017.6.

$274.7 - $1,017.6 = $742.9 total OCI Loss.

Thank you.