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Mark-to-Market Meddling1
“Smoothing” rules, which allow pension plan sponsors to amortize asset gains and losses over many years to compute Pension Expense, have recently come under attack. Several examples illustrate that shifting to an approach that reflects actual annual returns would dramatically increase fluctuations in Pension Expense. This could prompt some pension plan sponsors to either terminate their plans or invest less in equities, neither of which would be in the long-term interest of plan members.
Emerging Accounting Standards
The pension funding problem many companies are currently experiencing is one of a number of factors that have convinced accounting regulators that the current rules for pension, post-retirement and other post-employment benefit plan reporting are inadequate. Therefore, recent activity of the U.S. Financial Accounting Standards Board, the International Accounting Standards Board and the Canadian Institute of Chartered Accountants is of particular interest to Canadian pension and benefit plan sponsors.
Retiree Health Benefits: Time To Restructure?
Provincial downloading of health care costs, medical inflation and an aging workforce have made retiree health benefits increasingly expensive. Organizations that sponsor post-retirement health care programs need to find ways to control the actual cost of their programs and the impact on employer balance sheets. Because the financial challenges facing retiree health care plans results from the convergence of many forces, only a partnership of stakeholders can fashion the necessary multi-faceted solution.
Benefits Benchmarking: Retiree Health Care Benefits
Recent data from the Watson Wyatt COMPARISONTM 2001/2002 database presents a snapshot of post-retirement health coverage currently provided by Canadian employers. Participating employers can also obtain customized benchmarking studies.
The Changing Compensation Environment: One Size Does Not Fit All
Compensation strategies are changing in response to shifts in both regional and global business realities. Two senior Watson Wyatt compensation consultants were interviewed to get their perspectives on the evolving world of compensation. Liz Wright is the Human Capital Group Leader in Toronto, and Bob Curry is the Human Capital Group Leader in Kitchener-Waterloo and Compensation Solutions Development Leader for Canada.
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