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How much is the retirement liability as at september

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Reference no: EM133184663

Question - IS Paper Products Corporation maintains a tax-qualified, funded, noncontributory defined benefit retirement plan covering substantially all of its permanent employees. The benefits are based on years of service and compensation during the latest year of employment. A retirement valuation was made as at each financial yearend. The defined benefit retirement plan meets the minimum retirement benefit specified under Republic Act (RA) No. 7641, Retirement Pay Law.

The following has been provided to you in relation to your disclosure review:

Information with respect to plan as at September 30, 2020

Present value of defined benefit obligation P435,989,821

Fair value of plan assets 56,960,554

Information for fiscal year ended September 30, 2021

Current service cost P38,723,348

Curtailment gain 164,058

Actual return 939,573

Contributions paid 8,800,000

Benefits paid by the plan 14,406,436

Benefits paid directly by the Company 5,279,466

Increase (decrease) in the present value of retirement benefit obligation due to actuarial changes arising from:

Changes in financial assumptions (78,652,953)

Changes in demographic assumptions 499,765

Experience adjustments (14,753,242)

The discount rate is 7.6% and 5.90% as at September 30, 2021 and 2020, respectively.

Required - Based on the information above, answer the following:

1. Based on the information on IS Paper Products Corporation, how much is the retirement expense (income) recognized in profit or loss for the year ended September 30, 2021?

2. Based on the information on IS Paper Products Corporation, how much is the retirement liability (asset) as at September 30, 2021?

Reference no: EM133184663

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