EUROPE - The European Federation for Retirement Provision (EFRP) has joined opposition to Accounting Standard Board's proposals to change the way pension fund assets and liabilities are calculated and reported.
EFRP also said future discretionary salary increases should no longer be included in the measurement of pension liabilities for current employees, but the effect of these should, however, be included in the disclosures in company accounts.
It added employers in industry-wide plans - such as in the Netherlands - and other multi-employer arrangements where risks are shared, should continue to be exempt from the pensions accounting standard.
ERFP's comments come after a number of other industry bodies have voiced opposition to some of the ASB proposals, particularly using a risk-free rate rather than the high-quality corporate bond rate required by current accounting standards.
Yesterday, the National Association of Pension Funds warned the proposals were likely to further weaken and erode UK defined benefit (DB) schemes if left unchanged (www.globalpensions.com; 14 July 2008).
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