Pension RC Posted October 22, 2014 Posted October 22, 2014 When doing a valuation for a new solo-practitioner DB plan, where there is no past-service, we've included the current year comp in a BOY val for the first year, but not for the subsequent years. I assume that, if there was past-service, then it would be inappropriate to include current year comp even in the first year (with a BOY val). Is this correct? Thanks for any responses!
david rigby Posted October 22, 2014 Posted October 22, 2014 Perhaps use an EOY valdate? I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
Mike Preston Posted October 23, 2014 Posted October 23, 2014 This is like the bad penny that keeps turning up. The compensation projection used in a BOY valuation is up to the actuary. It is an assumption. The actuary must choose what compensation to use just like the actuary must choose all of his/her assumptions.
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