Amortization of Net Gain/Loss

Definition: Amortization of Net Gain or Loss is the periodic recognition in pension expense of cumulative actuarial gains and losses that exceed a 'corridor' e…

Amortization of Net Gain or Loss is the periodic recognition in pension expense of cumulative actuarial gains and losses that exceed a 'corridor' equal to 10% of the greater of the Projected Benefit Obligation or the market-related value of plan assets. Excess amounts are amortized over the average remaining service life of active employees under ASC 715. Common sources of actuarial gains/losses include changes in discount rate, mortality assumptions, and differences between expected and actual returns on plan assets.