Set out below are the pensions' issues that would currently be top of our agenda if we were the FD of a company with a DB scheme. 

Only a couple of months remain before the Pension Protection Fund’s (PPF) data cut-off point for the 2017/18 PPF levy. We highlight some of the things that can still be done to manage the size of your PPF levy before the 31 March 2017 data deadline, including one or two new methods introduced by the PPF.

Find out more

Our latest Current Issues in Pensions Financial Reporting newsletter details the key financial assumptions required for determining pension liabilities under the FRS102 (UK non-listed), IAS19 (EU listed) and ASC715 (US listed).

Find out more

In October, Carclo plc announced that the rise in its accounting pension deficit (as measured by IAS19) meant that it was no longer able to pay its interim dividend. An extreme case maybe, but pension scheme deficits are expected to weigh heavy on corporate balance sheets come the calendar year end.

The impact of Brexit on UK pension schemes has been a popular topic of discussion over the past few months. Much of this may have previously considered the balance sheet volatility that we might expect from a defined benefit pension scheme.

The difference this time is the sheer size of the swings and the real-world impact the accounting numbers can have.

We estimate that for a typical UK pension scheme the accounting position will have deteriorated from 90% funded to around 80% funded since 31 December 2015, driven by the double whammy of plunging corporate bond yields (which drive the discount rate for pensions accounting purposes) and rising inflation expectations.

So what can be done?

Find out more

We are now two years into an era of freedom and choice in defined contribution (DC) retirement savings. For members of a defined benefit (DB) scheme, making the most of these flexibilities will involve transferring to a DC arrangement.

Find out more

The Pensions Regulator (TPR) has issued regulatory guidance for trustees and employers, intended to help develop an Integrated Risk Management (IRM) approach to scheme funding.

Find out more

The pollsters were wrong again, and the UK public has voted to leave the European Union (EU).

While the longer-term impact on pension schemes has yet to be seen, the decision has hit markets hard and the immediate impact was sharp falls in the equity markets, sterling and gilt yields.

Find out more

A Code of Good Practice was published in 2012 following concerns about poor practices being adopted when undertaking a liability reduction exercise. The Code was revised in February 2016 to take into account developments in the pensions landscape. 

The Code is intended to improve the standard of Incentive Exercises whilst acknowledging that they remain a legitimate tool for sponsors looking to manage the defined benefit scheme liabilities. 
Whilst the Code is voluntary, the Monitoring Board anticipates all Incentive Exercises will follow the spirit and principles of the Code. The Pensions Ombudsman and Financial Ombudsman Service will also use the Code when arbitrating on disputes involving Incentive Exercises.
Examples are available alongside the Code to help illustrate when a particular situation might fall within the scope of the Code, and other issues such as proportionality.

The Code of Good Practice on Incentive Exercises for Pensions can be found using the link below.

Find out more