In determining whether you have a pension asset or a liability, you net out the assets and the liabilities. If you have larger liabilities than assets, you have a net pension liability.
If you have larger assets, then you have a net pension asset. How much you record on the balance sheet as an asset is the surplus “EXCEPT that the amount of reported asets is subject to a ceiling defined as the present value of future economic benefits, such as refunds from the plan or reductions of future contributions” - pg. 181, study session six
What are these? Doesn’t it make more sense to have the assets minus those? In other words, if you have $500 in asset surplus, that means you will get less future contributions of a PV of $25. doesn’t it make sense to record assets of $475 than $25?