Hi everyone I'm trying to make summary notes of the main funding methods, including trying to piece together when a particular funding method is required (e.g. SFO needs an accrued benefits method), but having a hard time trying to trawl through the various chapters to see where whether a particular funding method HAS to be used (and sometimes it's not clear whether it's just the norm or really HAS to be used). If anyone knows a little summary that would be great! Thanks in advance!
I'll start you off: SFO: accrued benefits method Accounting: all three are Projected Unit Method - FAS - FRS - IAS PPF: irrelevant as all actives are assumed to become deferreds Solvency: irrelevant as all actives are assumed to become deferreds M&A: matter for negotiation
Thanks Stuart - really helpful! I thought this was the case, but always nice to have someone confirm it! For the accounting standards, I know the SCR for all three are meant to be PU. And for IAS and FRS, PU should be used for calculating the liabs for working out the IC etc. But I'm getting a little confused over the FAS requirements; There seems a requirement to disclose the Projected Benefit Obligation (PBO) - past service liab - including future sals - PU method and the Accumulated Benefit Obligation (ABO) - past service liab - NO sal growth - deferred reval - i.e. CU method Question is, should it be the PBO or the ABO that should be used when working out the IC etc. If it needs to be the PUM SCR then I'm guessing it's the PBO...? Thanks again.
