Past service costs that have vested must be deferred and amortized through pension expense over time, while gains or losses on plan curtailments must be immediately recognized.

Question

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Past service costs are recognized immediately in profit or loss if the benefits are already vested. Gains or losses on plan curtailments are also recognized immediately in the period in which the curtailment occurs.

Past Service Costs That Have Vested Must Be Deferred and Amortized