UK - Most European firms are not in a position to comply with the new international accounting standard for pension costs, Watson Wyatt claims.
Listed companies in the EU will have to report pension costs according to IAS19 from 2005 – although first assessments are needed for many companies from December 31.
But Watson Wyatt’s survey shows that only 31% of firms are “quite well” or “highly” prepared for the introduction of IAS19.
The consultant said the study also revealed that:
• 10% of firms had undertaken no preparation at all.• 30% could not state how many material defined benefit schemes they operate around the world.• More than half of respondents had not yet quantified the impact of the transition to IAS19. For those who had, most reported an increase in the assessed value of liabilities.
Watson Wyatt partner Eric Steedman said: “IAS19 is not just a compliance burden, it is a great opportunity for companies, particularly multinationals, to understand their pension obligations better and manage them in a more consistent way.”
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