If the firm has net operating losses it is carrying forward and has excess pension assets (overfunded), then it is more likely to terminate than to convert, but if the firm is currently paying federal tax and has excess pension assets, termination of an
overfunded pension plan will likely involve paying substantial taxes.
An
overfunded pension plan should have allowed the Postal Service to scale back contributions, freeing funds for improved service or rate reductions.
Answer--An employer with an
overfunded pension plan can amend the plan to add postretirement health insurance as an additional incidental benefit.
Once the calculations are complete for all plans, the employer must aggregate the net balances of all
overfunded pension and other benefit plans into a single asset on the balance sheet.
GE) could have major implications for government contractors with
overfunded pension plans.
The Effect of Voluntary Terminations of
Overfunded Pension Plans on Shareholder Wealth," by Jack VanDerhei.
The
overfunded pension plan, built in large part by employee contributions, can easily afford to pay more, say the retirees.
An Empirical Analysis of the Factors Underlying the Decision to Remove Excess Assets from
Overfunded Pension Plans.
In IBM's case, it did have an
overfunded pension plan.
As part of the corporate restructuring, Union Carbide effected a reversion of pension plan funds from its
overfunded pension plan and used it to buy back company stock.
As long as the pension fund assets are expected to grow at least as rapidly as the pension obligation,
overfunded pension plans will continue to generate negative pension expense for a long time.
WHX, which has serious problems with pension funding and medical care for retired workers, was generally thought by analysts to be interested in Teledyne because of its heavily
overfunded pension funds.
