UK – There’s a lively online debate taking place amongst accountants about the merits - or otherwise - of including actuarial liabilities within the financial reports of pension schemes.

The Pension Research Accountants Group’s online discussion board is full of arguments over the impact of the FRS17 accounting standard on actuarial liabilities.

Referring to actuarial assumptions and ability to be audited, one online debater remarks that FRS17 seems to “have swept all these issues away”. Another says that the readers of company accounts are being “fundamentally misled” by FRS17.

Another writer says the Accounting Standards Board is “misunderstanding” the nature of a prospective final salary pension liability for an occupational scheme’s trustees.

FRS17 is an accounting standard which takes a market view of a pension fund’s liabilities. Its mandatory implementation has been deferred until 2005.

The commentators appear to be writing in a personal capacity and do not necessarily reflect the any official PRAG policy.

At the request of the ASB, PRAG is consulting on whether actuarial liabilities should be included within pension funds’ financial reports. The 400-member body issued a 12-page consultation paper in November 2002 and plans to publish the results of the consultation exercise in the second quarter of 2003.

Nigel Barton, PRAG’s chairman, could not immediately be reached for comment.

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