beware of this disparity in adjustments to CFO that arise from employer contributions being greater or less than pension expense:
in the 2011 cfai issued mock exam: the pension expense used is simply income statement pension expense, that is pension expense which incorporates “expected return on plan assets”
on the contrary, schweser videos (at the end of post retirement vid), clearly state that the “economic pension expense” is compared to the employer contributions in order to adjust the CFO and CFF
if contributions exceed CFO its like paying off debt and CFO increases, CFF decreases by the tax-affected excess contribution
as we know, “economic pension expense” is different and incorporates actual return on plan asset
EPE = change in PBO + Benefits Paid - Actual Return on Plan Assets
EPE = contributions - change in funded status
who the f knows what is the right way.