The plan of Corlan SA is in surplus by 800,000. Corlan has an unconditional right to a refund whose present value is 300,000. For future services, the present value of future service costs under IAS 19 is 600,000 and that of the minimum funding contributions required for those same future services is 650,000. Additional contributions of 120,000 (present value) cover an existing minimum funding shortfall in respect of services already rendered; once paid, they will remain available to Corlan as a refund (case data). Calculate the excess of the minimum funding contributions for future services over the future service cost, the benefit available as a reduction in future contributions (floor at zero) and the net asset to recognise.
- Plan surplus
- 800,000
- Present value of the refund the entity is entitled to
- 300,000
- Present value of future service costs (IAS 19)
- 600,000
- Present value of minimum funding contributions for future services
- 650,000
- Contributions covering an existing shortfall (services already rendered)
- 120,000