Project UC vs. Traditional UC

[JAY21]

I realize that traditional unit credit funding is associated primarily with non-pay related formulas and projected unit credit with pay-related formulas. That said, is there any argument or ability to still use traditional unit credit with a DB "accumulation" plan where the formula is a certain % of each year's compensation. While I assume I could, maybe should, use projected unit credit in this situation I'd prefer not to due to budget constraints. I realize the ER pays more on the back end if a salary scale is not used.

Anyway, any thoughts on whether I still have a reasonable funding method if I use traditional UC funding in this situation ?

[Guest Texas_Acty]

Why do you suppose TUC might be an unreasonable method in your situation?

[JAY21]

I don't personally believe it's unreasonable, but our new software vendor for our DB funding has the valuation system set-up to automatically run any salary related benefits using PUC. They have told me verbally that's their interpretation of Rev. Proc. 2000-40. I disagree but figure I could be wrong and hence this post.

[Guest Texas_Acty]

Your accumulation plan sounds like a career average plan, which is not considered a final pay plan. Therefore, TUC is a reasonable method.

I'm intrigued as to why your software vendor does not concurr.