Submitted by: Submitted by cindyfit
Views: 466
Words: 750
Pages: 3
Category: Business and Industry
Date Submitted: 01/24/2011 12:59 AM
A.H. Belo Financial Restatement
Lucinda Davis-Brown
ACC/537
January 17, 2010
Carla Ross
A.H. Belo Corporation
A.H. Belo Corporation is a newspaper publisher based in Dallas, Texas. During the audit of the financial statements for the fiscal year ending December 31, 2009, the discovery revealed that an accounting principle used for its contractual obligation to Belo Corporation under the employee matters agreement effective February 8, 2008 was not applied correctly.
A.H. Belo supposed to reimburse the Belo Corporation for sixty percent of their contributions to the G.B. Dealey Retirement Pension Plan totaling $118 million. As a result, the company realized that these contributions were not accounted for in the employee matters agreement or in the literature distributed. A. H. Belo disclosed on its year end December 31, 2009 10K report that pension plan, frozen in March 2007, showed underfunded by $196 million. The company decided to replace the employee matters agreement with a multiemployer pension plan based on a thorough review of its contractual obligation to the parent company.
The multiemployer pension plan changes their accounting policy relating to this contractual agreement. The company has adopted the multiemployer pension plan provisions of ASC Number 715 “Compensation Retirement Benefits.” This multiemployer plan is similar to the employee matters agreement. The law firm of McGladrey and Pullen, LLP. states that, “Under the FASB Accounting Standards Codification (ASC), a multiemployer plan is described as a pension or post-retirement benefit plan in which two or more employers contribute, usually pursuant to collective-bargaining agreements. The contributions by one participating employer may be used to provide benefits to employees of other participating employers. Obligations are not assumed by a withdrawing employer, rather the liability to pay the retirement benefits remain
with the plan. An employer...