CPEA compensation series: Rabbi trust arrangements

In this report, we cover the guidance related to rabbi trust arrangements. The FASB ASC master glossary defines rabbi trusts as “…grantor trusts generally set up to fund compensation for a select group of management or highly paid executives. To qualify as a rabbi trust for income tax purposes, the terms of the trust agreement must explicitly state that the assets of the trust are available to satisfy the claims of general creditors in the event of bankruptcy of the