Pension accounting doubt

Hey all,

Hope everyone’s CFA prep is going well. I had a doubt in question number 9 of pension accounting EOC. The questions asks to calculate periodic pension cost to be reported in P&L under IFRS. According to schweser notes the discount rate = expected rate of return on plan assets under IFRS but in the solution to EOC 9 they have used the discount rate to estimate plan liabilities to arrive at the PPC answer and not the expected rate of return on plan assets. Can someone please clarify what the issue is? This is my first post here on analyst forum so I wasn’t sure if I should post the question here. Any help will be appreciated!

That’s weird. This applies under US GAAP.

For IFRS, the discount rate is the one that is used to estimate PBO.

Which reading is this?

This is reading number 14, Employee Compensation: Post Employment and Share-Based.

Hi I believe it’s the other way around: in IFRS the expected return on plan assets needs to be in line with the discount rate 7% (which in turn is based on high quality corporate bond rates), not the other way around.