ACTUARIAL COST METHOD
A method employed by actuaries for the calculation of the periodic amount that a company has to pay for the coverage of the pension expenses. The two primary method employed are the benefit approach and the cost approach.
The total final benefits, which are based on several assumptions like the rate of wage increase and date of retirement of the employees, are calculated on the cost approach. The amount of funds needed for the future benefits are also determined. Meanwhile, the benefit approach determines the future benefits' present value by means of discounting them.
Sometimes referred to as actuarial funding method.
POPULAR TERMS
Asset Substitution Problem
A problem which arises when a company trades its low-risk assets for high-risk investments. This substitution moves the value from the bondholders ...
Lawful Money
Any currency, in coin or paper form, that is issued by the United States Treasury, not the Federal Reserve System. It also includes gold and silver ...
Red Clause Letter Of Credit
It refers to a specific type of letter of credit where a buyer extends an unsecured loan to a seller. This permits documentary credit beneficiaries ...
Trust Certificate
Bond or debt investment backed by other assets and serve like a collateral. Normally in a public company, the assets may be seized or sold for the ...
Cowboy Marketing
Slang term for a situation in which a firm is unaware a marketer sends massive spam emails to everyone promote the stock, instead of producing legi ...
POPULAR ARTICLE
SEE FOREX TUTORIAL
A Guide to Your Personal Income Tax: Essentials
In the United States, the progressive tax system is one of the most important yet misunderstood concepts of tax planning. Whenever people are asked ...
Ethical Investing: Knowing Human Rights and Workers` Rights
Ethical investors want to know how corporations treat people, specifically their workers. They depend on the UN Universal Declaration of Human Righ ...
Ethical Investing: Its Advantages and Disadvantages
Believe it or not, ethical investing comprises a huge emotional component. Investors are human; therefore, they let emotions drive their decisions. ...
Digesting Financial Statements: Revenue
When it comes to reporting revenue, companies should pinpoint the perilous revenues, match reported revenues to the money at hand, and analyze and ...
Retirement Planning: Allocating and Diversifying
The assets you select to invest in will depend on numerous factors, including your risk appetite and investment timeframe. The two primary factors ...
ECONOMIC CALENDAR
Time | Country | Indices | Period |
---|---|---|---|
05:00 | Credit Card Spending | Mar | |
14:30 | Industrial Product Price Index | Mar | |
14:30 | New Housing Price Index | Mar | |
14:30 | Raw Materials Price Index | Mar | |
16:00 | Consumer Confidence | Apr | |
02:30 | PMI Manufacturing | Apr | |
02:30 | Tertiary Industry Index | Apr | |
02:30 | PMI Composite | Apr | |
08:00 | Public Sector Net Borrowing | Mar |