Attribution for Projected Unit Credit/FAS 87

[Guest Texas_Acty]

I am working with a takeover case that has the following background:

Plan population was spun off from a larger plan at 1/1/1999.

Formula is:

1. Total service (pre- and post-spinoff)/current pay formula

minus

2. Frozen accrued benefit (constant)

minus

3. Pre-spinoff formula based on frozen service (pre-spinoff) and current pay

I have come to learn that, for FAS 87, the attribution being applied to this entire formula is service since 1/1/1999.

I cannot come up with an argument that would justify this attribution pattern.

I would apply an attribution on each numbered formula component in this manner:

1. Total service

2. No proration (benefit is entirely accrued)

3. No proration (benefit is entirely accrued)

Feedback?