Skip to content

Acturial Pension Plan Assumptions

December 20, 2015
  • All plans must make/disclose 3 assumptions
    1. Discount Rate
    2. Rate of compensation increase
    3. Expected return on plan assets (U.S. GAAP only) Does not affect PBO
  • These assumptions can affect:
    • Balance sheet (through effect on PBO)
    • Income statement (pension cost)
  • Pension accounting: The greatest earnings manipulation tool known to management
Advertisements
Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: