|
Policy Analysis
Asset Allocation. Research has
shown that better than 90% of the performance of a pension fund is
attributable to asset allocation. With Monte Carlo simulation and true
asset and liability integration you will see the risk/reward tradeoffs
as they affect contributions, funding ratios and pension expense.
Funding Policy. Contributing the
minimum acceptable amount to the pension fund is not always the best
strategy. Funding decisions affect the path of funding ratios, expense
and contributions out into the future. You are able to test different
funding policies and see these important effects. The range of funding
policy alternatives is affected by the choice of an actuarial cost
method, an asset valuation method, amortization procedures and timing of
when contributions are made. All of these choices are at your disposal.
Financial Reporting. Policies
regarding selection of the discount rate, expected rate of return and
corridor affect pension expense and additional balance sheet
obligations. You can manage accounting results using the software to
determine these policies.
Plan Design. Plan changes range
from negotiated increases in benefit levels and ad hoc cost of living
adjustments to sweeping changes in the formulae for benefit accruals.
The software is used across this spectrum to determine the financial
impact of proposed changes now and into the future.
| 