Which statement is true regarding the recognition of employer pension contribution receivables?

The correct assertion about the recognition of employer pension contribution receivables is that it relies on a formal commitment for contributions. This is vital because a pension contribution receivable represents a future inflow of resources that the employer is obliged to provide for the pension plan. In order for this receivable to be acknowledged, there needs to be clear evidence or documentation confirming the employer's intent or obligation to make those contributions.

A formal commitment ensures that the pension contributions are expected and legally enforceable. This can include contracts, collective bargaining agreements, or formal policies that dictate the employer's obligation to fund the pension plan. Without such a commitment, the recognition of the receivable would be speculative and not in accordance with the accrual accounting principles that guide financial reporting for pension liabilities and assets.

The valuation of contributions based solely on payment history does not take into account future obligations and ignores the necessary enforceable agreements that must exist for the recognition of these receivables. Similarly, recognizing contributions without a commitment or relying solely on employer liability recognition lacks the necessary foundation that sound accounting principles demand for valid receivables.