Pension Plan Funding Shortages

This year, my two partners and I participated in the Business Financial Plan category. We presented at the District Leadership Conference, where we the advanced to State. This project benefited me in numerous ways. For instance, at the time, I was undecided on my career choice. Participating in this event caused me to acknowledge the financial considerations that need to be taken when operating a business. I soon learned that I enjoyed calculating the finances for a business and determining the most efficient ways for it to operate. Therefore, this event has contributed in my career choice. Due to the impact FBLA has made on my life and the involvement of it, this organization has benefitted me in ways other organizations have

9. How did the pension plan changes affect Harnischfeger’s financial statements in 1984? Are these changes likely to affect future profits?

On August 11, 1998, United States Amoco Corporation (Amoco) and The British Petroleum Company p.l.c. (BPC) announced the BPC merger with Amoco. With a combined number of participants of 40,000 and $7 billion investment assets under management, the merged pension and savings plan of the new company is viewed by both management and employees as a bellwether of the success of the merger. Therefore, the new investment team must be able to “harmonize” the very different two original plans.

This strategy helps us cover the revenue shortfall. Based on the spreadsheet the compensation categories, including salaries and wages, account for 60% of the spending reductions. As a matter of fact, we hired 10,000 employees in 2015 with the high salary, which caused the revenue shortfall. Now, we need to reduce our employees number to 9000 to cover the revenue shortfall. We know how difficult this news may be, but we know that we have to act under cost savings in the coming months and years. I believe that this budget is a vital and responsible action in the short time to manage the immediate required budget shortfall as well as enable us to prepare for the uncertainties of the

Growth and change in any organization can be a difficult time both for executives and for employees. When growth comes at an astounding rate, there are bound to be problems at all levels of the organization. Senior Health Plus (SHP) is a small, non-profit HMO based in Southern California. The company started as a grassroots organization that enjoyed a positive reputation for pioneering new ways to care for the elderly. This success has a price however, as the membership of SHP has grown exponentially in the past several years from 10,000 to 35,000 members. In response to this growth, management went on an expansion frenzy, moving all executives to a

Medford University is up against a financial crises and the management have found the need to tackle the crises on high priority. The primary focus is to tackle the considerable cost of fringe benefits and retirement benefits offered by the university to its employees. A whooping $100 million is spent annually by the management towards the fringe benefits for the employees (Brickley, Smith, & Zimmerman, 2009). In an attempt to find a solution for reducing these costs, the management could have approached the Human

The change in the return on investment assumption is for all US plans. The economic consequence is that there will be less injection of cash by these pension owners during the lifetime of their pension. In 1984 the corporation established a new plan, which goal was an improvement in the minimum pension benefit. This constituted in a restructure of the Salaried Employees’ Retirement Plan.

For pensions and post-retirement accounting methods to recognize the benefit costs, estimates and assumptions on future events ascertaining the timing and amount of benefits payments must be sought first. This paper seeks to compare and contrast the early historical accounting for pensions and post-retirement healthcare and life insurance benefits with the rules and guidance applied today in addition to the changes to such guidance and rules that would improve the accounting and reporting of such benefits depending on the business and political changes and as such, predict the effect of such changes on financial reporting and accounting practices.

As a business owner, you know that the areas of your business you focus on have a tendency to improve. With just a small amount of effort, Woita & Associates can help you focus on your company sponsored 401K. We can help you identify important questions to ask and provide data to help you make informed decisions. Learn about fees, funds, and the difference local service can make for your

Political climate change, Political philosophy say that it would not increase or decrease. Political philosophy think that when you are not sure, select the option that minimizes profits and assets. This would have been more conservative if only underfunded plans were book to liabilities and overfunded plans were just reported in documents but no asset booked. Given the extensive assumptions, the certainty of future benefits is not very high. Overfunded plans can turn too underfunded with one deep plunge of the stock market, as happened in fall 2008. According to www.nrln.org an good example, General Motors used pension assets to pay for nearly $3 billion in lump sum severance payouts during 2008 and ended up with such a dangerous degree of under-funding that in early 2009 the Treasury Department restricted the practice as a condition of the federal bailout loan package. In 2012 it terminated its plan for management and salaried retirees entirely. (www.nrln.org)

Accordingly, the $39.3 million actuarial gain which resulted from the restructuring is included in Accrued Pension Costs in the accompanying Balance Sheet and is being amortized to income over a ten-year period commencing in 1984. The effect of the changes in the investment return assumption rates for all U.S. plans, together with the 1984 restructuring of the U.S. Salaried Employees' Plan, was to reduce pension expense by approximately $4.0 million in 1984 and $2.0 million in 1983, and the actuarial present value of accumulated plan benefits by approximately $60.0 million in 1984. Pension expense in 1983 was also reduced $2.1 million from the lower level of active employees. Other actuarial gains, including higher than anticipated investment results, more than offset the additional pension costs resulting from plan changes and interest charges on balance sheet accruals in 1984 and 1983.

Budgets serve five main purposes; planning, facilitating communication and coordination, allocating resources, controlling profits and operations and evaluating performance and providing incentives. The budgeting process requires both technical and interpersonal leadership skills to achieve each of these purposes effectively. The director’s memo demonstrates several short comings in the budgeting process. The director instituted the “responsibility accounting system” as a means of evaluating performance. However, the DPW director has not consulted Sam in the budget process. Sam understands that his total expenditures are impacted by relatively unpredictable events that contribute to an uncontrollable element of his cost. The

Our company has been providing their employees with a pension plan for many years. However, these benefits plans have to be reviewed and possibly revised after the recent acquisition of XYZ Company. Through the use of a funding agency, payments are invested so that periodic payments can be made to the employee during retirement. Defined contribution and defined benefit are the two most common types of pension plans.

Potential area of resistance will be in regards to the unfunded pensions of employees. Possible strategies for this area of

Pension funds are any plans, funds or schemes which provide retirement income. These funds are important to shareholders of listed and private companies and they are particularly important to the stock market which is dominated by large institutional investors. This essay discusses the idea of pension funds and the pension crises. It defines the issues of pension funds, talks about the various pensions, categorizes them, and discusses the pension crisis and its implications to the US in particular and to the world in general.