what are refunds from the plan or reductions of future contributions?

CFA Level II
#1

In determining whether you have a pension asset or a liability, you net out the assets and the liabilities. If you have larger liabilities than assets, you have a net pension liability.

If you have larger assets, then you have a net pension asset. How much you record on the balance sheet as an asset is the surplus “EXCEPT that the amount of reported asets is subject to a ceiling defined as the present value of future economic benefits, such as refunds from the plan or reductions of future contributions” - pg. 181, study session six

What are these? Doesn’t it make more sense to have the assets minus those? In other words, if you have $500 in asset surplus, that means you will get less future contributions of a PV of $25. doesn’t it make sense to record assets of $475 than $25?

#2

The idea here is that the “asset” is really for the benefit of the pension plan, not so much the company. That is, the company couldn’t go and get money out of the pension plan to use for other parts of its business, so to some extent it makes sense to limit the balance sheet position to future refunds (what the company will definitively get back and is able to utilize).