Curtailment refers to a significant reduction in the benefits provided by an OPEB plan, while settlement gains or losses occur when an employer pays off the plan obligations, either partially or fully, resulting in a change in the recognized liability. These concepts are crucial for understanding how changes in an OPEB plan impact a company's financial statements and the obligations it holds towards its employees after they retire. By managing curtailments and settlements, companies can influence their reported expenses and liabilities associated with post-employment benefits.
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