If you contribute to a multiemployer pension plan, new disclosures will need to be added to your local union’s financial statements this year. In September 2011, the Financial Account Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-09, Disclosures about an Employer’s Participation in a Multiemployer Plan, requiring employers that participate in multiemployer pension and other postretirement benefit plans to provide additional quantitative and qualitative disclosures. The amended disclosures provide users with more detailed information about an employer’s involvement in multiemployer pension plans, including:
  • The significant multiemployer plans in which an employer participates, including the plan names and identifying numbers
  • The level of an employer’s participation in significant multiemployer plans, including the employer’s contributions made to the plans and an indication of whether the employer’s contributions represent more than 5% of the total contributions made to the plan by all contributing employers
  • The financial health of the significant multiemployer plans, including an indication of the funded status, whether funding improvement plans are pending or implemented, and whether the plan has imposed surcharges on the contributions to the plan
  • The nature of the employer commitments to the plan, including when collective-bargaining agreements that require contributions to the significant plans are set to expire and whether those agreements require minimum contributions to be made to the plans

Financial statement users will be able to obtain additional information from outside sources (such as the plan’s Form 5500) using the employer identification number, the plan name, and the plan number.

For local unions who make contributions on their employees’ behalf into multiemployer pension plans, the amendments are effective for their December 31, 2012 financial statements. The amendments should be applied retrospectively for all prior periods presented. Let us know if you have any questions.