New SFAS 132 Available

[MGB]

The FASB has posted the revised Statement 132 on its website:

http://www.fasb.org/

Note there is also a Q&A listed after the Statement itself.

(This is the first time that a release has been posted on the website...it is primarily due to the short time period to its implementation: actually retroactive by now.)

[Effen]

Thanks MGB.

I just registered for the 2004 EA meeting and look forward to hearing your session.

[AndyH]

Thanks, MGB.

Hmm. What might be an appropriate Christmas present to send these "people" who have given us such lead time.

[mwyatt]

How about some more Xmas presents from season's past?

1983: Mad rush to send out 242(b) notices;

1994: Maddening rush for TRA '86 DB restatements, until a very late reprieve after you've completely sent yourself to the loony bin; coupled with

1994: GATT implementation!

Have a Merry Christmas all...

[Effen]

Other than expected benefit payments and contributions, are other actuaries planning on "disclosing" the asset information?

From the press release....

"For the first time, companies are required to provide financial statement users with a breakdown of plan assets by category, such as equity, debt and real estate. A description of investment policies and strategies and target allocation percentages, or target ranges, for these asset categories also are required in financial statements."

Do any of you feel this falls on the actuaries to disclose in their reports? It seems to me that the accountant is best qualified to prepare this. Any thoughts?

[MGB]

I totally agree that this is not something the actuary should be doing. But, I disagree that the accountant should be doing the narrative part of this.

These narrative disclosures should be developed by the plan sponsor (or the trustees, investment committee of the Board, or whatever group actually has the authority to make investment decisions).

For the percentage breakdown by category, that will depend on who has easiest access to the information (remember, gathering this information is typically under tremendous time pressure). I don't see any reason for the actuary to be the one doing it, nor any reason why it would be in their report.

Although much of the information in a footnote comes from the actuary, there is no reason why the actuary needs to have all footnote information in their report when some of that information needs to come from elsewhere and that information has no bearing on the information produced by the actuary.

[AndyH]

Any new comments on this? What additional disclosures are actuaries being asked to provide? Our accountant FAS#87/#132 requests seem to coming in awful slow this year. Has anybody figured out/agreed to the lines of responsibility?

[Guest dmdoug]

I am being asked by the auditors to supply the narrative description of the basis used to come up with the expected rate of return on assets, 5(d)(3). While I was in on the discussion about its selection, I have always felt that the discount rate and erroa were ultimately the plan sponsor's and auditor's call. I may assist the plan sponsor with the narrative, but the letter will come from the ps, not me.

Btw, I was also told by the auditor that a simple statement referrring to historical returns would not suffice.