Search the News Archive

Comment Letter by the Joint Committee on Retiree Health of the American Academy of Actuaries, to Actuarial Standards Board on Revised ASOP No. 6, Measuring Retiree Group Benefit Obligations (PDF)

"[This Committee] commented at considerable length a year ago on the first exposure draft (ED) and are pleased that the second ED effectively addresses many of the concerns expressed.... There are fundamental differences between pension and retiree health, and our comments focus on the need for ASOPs to recognize those differences. We continue to have concerns that ASOP No. 4 language regarding pensions is used more than is needed within ASOP No. 6 and that the problem of implicit subsidies (and age specific costs for groups in pooled health plans) is not sufficiently addressed."

American Academy of Actuaries Joint Committee on Retiree Health, on Proposed Revisions Comment Letter to ASOP No. 4, 'Measuring Pension Obligations and Determining Pension Plan Costs or Contributions' (PDF)

"While some of the recommended practices of ASOP No. 4 may have applicability to retiree group benefit measurement, others may not. The interests of practitioners and the ASB will be served best by having separate standards for each practice area[.]"

Text of Letter from American Academy of Actuaries to Actuarial Standards Board on Coordinating ASOPs Involving Retirement Benefits (PDF)

"To effectively coordinate the two standards, we recommend the [Actuarial Standards Board (ASB)] look at the retirement benefit standards holistically, with detailed attention from both pension and [retiree group benefit (RGB)] specialists in drafting the concepts and language. The differences between the pension practice and the RGB practice (primarily retiree health benefits) need to be examined, with an understanding that below-standard work in any practice is a disservice to the public and our profession. Given the differences in pension and RGB practice, the ASB should review the process that placed the ASB Pension Committee in the position of editing an RGB ASOP."

American Academy of Actuaries Comment Letter to Actuarial Standards Board on ASOP No. 35, Selection of Demographic and Other Noneconomic Assumptions for Measuring Pension Obligations (PDF)

"In the more substantive sections in the exposure draft ... there is no mention of [retiree group benefits (RGB)] plans; every reference is to pension plans.... The lack of specific reference to RGB may make it difficult for an actuary who needs guidance on work such as a retiree life measurement or a retiree health redesign to know what information from ASOP No. 35 applies. Similarly, anyone evaluating whether such actuarial work meets professional standards may find it difficult if there are no references to the RGB work in question."

American Academy of Actuaries Comment Letter to GASB: Exposure Drafts on Accounting and Financial Reporting for Other Postemployment Benefits (PDF)

12 pages. "We believe OPEBs constitute a liability. There may be associated questions of legal liability and the measurement of the liability, but when a government is providing, or intends to provide, OPEBs, particularly retiree health benefits, to its retirees, the financial effects of doing so should be quantified and transparent to stakeholders. We support the GASB in its prior steps to do so and in the current effort to improve accountability of financial reporting and the usefulness of decision relevant information regarding OPEBs."

American Academy of Actuaries Comment Letter to National Association of Insurance Commissioners on Accounting for Post-Retirement Benefits Other than Pensions (PDF)

"On behalf of the Joint Committee on Retiree Health and Pension Accounting Committee of the American Academy of Actuaries', we appreciate the opportunity to provide comments to the National Association of Insurance Commissioners (NAIC) on the exposure drafts of Statements of Statutory Accounting Principles (SSAP) No. 92 and No. 102, which are intended to replace existing standards governing accounting for pension benefits and postretirement benefits other than pensions (OPEBs)."

American Academy of Actuaries Comment Letter to GASB on Proposed Rule for Reporting Medicare Part D Payments (PDF)

5 pages. Excerpt: Below we have described four principal approaches an employer can use to provide prescription drug benefits to its retirees and have a portion of the cost funded, either directly or indirectly, by payments from the federal government.

Text of Actuaries' Comments on Effect of Medicare Law on FAS 106 Disclosures (PDF)

Excerpt: On behalf of the American Academy of Actuaries'1 Joint Committee on Retiree Health, we would like to take this opportunity to indicate our support for the proposed FASB Staff Position (FSP) on ... FAS 106 ... deferring any accounting for the effects of the Medicare Prescription Drug, Improvement and Modernization Act of 2003. Members of this committee have already been asked by plan sponsors to provide actuarial insight into both the new law and its impact on compliance with FAS 106.

Letter on Financial Accounting and Reporting for Other Post-Employment Benefits in Public Plans (PDF)

2 pages. Excerpt: On behalf of the American Academy of Actuaries' Joint Committee on Retiree Health, we would like to address misinterpretations of a letter promulgated by our committee. That letter has recently been used as justification for proposed legislation in Texas that would nullify the requirement of governmental entities to establish financial reporting liabilities for promised retiree health benefits.

Comment Letter to National Association of Insurance Commissioners on Proposed Revisions of Accounting for Pensions and Other Postretirement Benefits (PDF)

3 pages. "The Joint Committee on Retiree Health and the Pension Accounting Committee jointly submitted comments to the NAIC regarding the exposure draft of SSAP 92 ... and proposed revisions to SSAP 89 (pensions)."