112 requires employers to account for severance benefits,
termination benefits, supplemental unemployment benefits, disability benefits, health care continuation benefits, survivor benefits, and all other post-employment benefits that are not pension retirement benefits on an accrual basis, in advance (just as they are required to do for pension benefits).
The company said late Wednesday no offers have developed and it expects to record restructuring charges ranging from approximately $200,000 to $400,000 in the third quarter of 2008 in connection with
termination benefits, including severance, outplacement and other fringe benefits.
This comparison highlights the large
termination benefits which companies can give while remaining below both the Part 2D.2 thresholds and the ASX threshold.
In the first quarter, Loblaw incurred CAN $75 million (US $68 million) of restructuring costs, comprising CAN $58 million (US $52 million) for employee
termination benefits, including severance, additional pension costs connected with the termination of employees, and retention costs, and CAN $17 million (US $15 million) of other costs, mostly consulting.
Revlon indicates that the streamlining will result in restructuring and related charges totaling about $29 million, a figure it says is composed primarily of such employee-related costs as severance and other
termination benefits. The company also anticipates an estimated $34 million in ongoing annualized savings, of which $5 million should benefit 2006 results.
Although the statement did not mention the total cost of the
termination benefits, The Star daily had earlier reported that it would be around 600 million ringgit.
This year, the GASB completed a similar effort involving
termination benefits, as marked by the recent release of GASB Statement No.
47, Accounting for
Termination Benefits (www.gasb.org/st/summary/gstsm46.html).
* Tallying
termination benefits for top executives under different scenarios
47, Accounting for
Termination Benefits, providing guidance for state and local governments that offer benefits such as early retirement incentives or severance pay.
The plant closure will result in first-quarter restructuring charges of between $8 million and $10 million from asset devaluation and about $4 million cash charges related to
termination benefits and other expenses that include costs to close the plant and consolidate operations.
The Governmental Accounting Standards Board has published an exposure draft of a statement, Accounting for
Termination Benefits, that would establish accounting guidance for state and local governmental employers regarding benefits provided to employees who terminate employment.