ESOP distribution and pre-1987 balances

[Guest jsample]

We recordkeep an ESOP where there has been a significant decline in the stock value, and hence employee balances.

Some employees who qualify for a partial distribution under the terms of the plan now have total account balances that are less than their December 31, 1986 account balances - even with the allocation of additional shares since 12/31/1986.

Should I adjust the 12/31/1986 shares for the current stock price, or do these employees not receive any distribution amount until they qualify for the remainder of the ESOP (12/31/1986 balance) upon attainment of age 65?

Thanks.

[BeckyMiller]

Not sure what you are asking here. ESOPs are required to do either stock accounting or non dollar unit accounting. Thus, if the share value has dropped, the number of pre-1987 shares would not have changed, just their value.

So - I guess when you say:

Should I adjust the 12/31/1986 shares for the current stock price, or do these employees not receive any distribution amount until they qualify for the remainder of the ESOP (12/31/1986 balance) upon attainment of age 65?

My answer is - you should adjust the 12/31/1986 shares for the current stock price.