Funded Status of a Pension Plan
Comparing Assets and Obligations
The funded status equals the fair value of plan assets minus the projected benefit obligation. If plan assets exceed the PBO, the plan is overfunded and reports a pension asset. If the PBO exceeds plan assets, the plan is underfunded and reports a pension liability.
Note
The funded status is reported on the balance sheet.
Summary
The funded status compares available pension assets with the employer's pension obligation.