EBS has created this guide to provide an overview of the accounting for a non-qualified deferred compensation program structured as a voluntary deferral plan, as well as for the assets associated with commonly used informal funding arrangements. This 9-page document is meant to provide a general understanding of the accounting; more detailed information is available upon request.
It is important to understand that the accounting for such programs and funding arrangements can be complex. There is no single source or authority that covers the accounting treatment – it is drawn from a variety of accounting pronouncements. In addition, because of the flexibility of plan design of NQDC programs, the accounting can vary based on the specific plan structure or provisions.