A contingent claim, or lien, placed by the Pension Benefit Guaranty Corporation (PBGC) against an employer's assets upon the termination of a pension plan to cover the amount of an employee's unfunded benefits.
An obligation recognized by the employer for the future liability to make annuity payments to employees. The reserve is typically a liability when it results from charging a pension expense. However, in a revocable plan, the reserve is considered an appropriation of retained earnings regardless of whether it affects specific assets.
