On the value relevance of SFAS No. 158

Robert Houmes, Robert Boylan and William Crosby

Research in Accounting Regulation, 2012, vol. 24, issue 2, 112-114

Abstract: After considerable discussion and some controversy, Statement of Financial Accounting Standards No. 158 entitled, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans” was implemented in 2006. An important goal of these standards was to enhance financial reporting transparency for defined benefit pension plans (FASB, 2006). This study evaluates how well SFAS No. 158 achieved its objective. In particular, we compare the respective pre and post-SFAS 158 incremental value relevance of the balance sheet and income statement for firms with defined benefit pension plans (DBPP). Results suggest that the value relevance of book value (net income) increased (decreased) for DBPP firms after the implementation of SFAS No. 158.

Keywords: Defined benefit pension plans; Value relevance; SFAS No. 158 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reacre:v:24:y:2012:i:2:p:112-114

DOI: 10.1016/j.racreg.2012.07.001

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