Why companies like at&t, verizon are shifting away from the "corridor approach"?
Why companies like at&t, verizon are shifting away from the "corridor approach"?
Homework Answers
The corridor approach usually defers the actuarial losses incurred by the companies. A lot of companies have significant amount of Actuarial losses like At&T, Verizon, etc.
They have now shifted to a fair-value-approach, which provides immediate recognition of most changes in plan assets and liabilities. This results in elimination of a drag in future earnings. Hence, most companies are shifting away from the corridor approach to fair-value approach.
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Why companies like at&t, verizon are shifting away from the
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