Document ID: chunk:federal_register_of_legislation:F2023C00383:reg:1
Version: federal_register_of_legislation:F2023C00383
Segment Type: reg
Provision Reference: reg 1
Character Range: 60224–61084

1                                   A defined benefit plan provides a lump sum benefit of CU100 payable on retirement for each year of service.
                                    A benefit of CU100 is attributed to each year. The current service cost is the present value of CU100. The present value of the defined benefit obligation is the present value of CU100, multiplied by the number of years of service up to the end of the reporting period.
                                    If the benefit is payable immediately when the employee leaves the entity, the current service cost and the present value of the defined benefit obligation reflect the date at which the employee is expected to leave. Thus, because of the effect of discounting, they are less than the amounts that would be determined if the employee left at the end of the reporting period.