Accumulated benefit obligation (ABO) - Financial definition
Financial acronyms
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Concise definition of the term accumulated benefit obligation
The accumulated benefit obligation is an estimate of the total amount a company would have to pay to retirees and current employees assuming the plan would be terminated immediately. It is the present value of all of its pension liabilities.
Comprehensive definition of the term accumulated benefit obligation
The value of future changes in employee compensation is not taken into consideration.