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2012 RETIREMENT PROGRAM SURVEY

ActuarialExponents, Inc. has finalized its 2012 survey of retirement programs. It involved 107 companies from different industries required to comply with either the Philippine Accounting Standards No. 19 or the Philippine Financial Reporting Standards for Small and Medium Enterprises.

Out of these companies, 76 (71%) have formal retirement programs. Of those with retirement programs 74 (97%) are of the Defined Benefit type.

Eighty percent (80%) use Basic Salary while the remaining 20% use Gross Salary (that usually includes the guaranteed additional monthly pay such as the 13th month pay).

The survey shows forty-one percent (41%) require employees to reach the age of 60 and complete 5 years of service to be able to receive the normal retirement age. Forty-nine (49%) percent require only the age of 60.

Sixty-nine percent (69%) provide a fixed normal retirement benefit with the remaining 31% providing a normal retirement benefit that either increases with years of service or age at retirement.

The most common normal retirement benefit is 100% of monthly salary per year of service provided by 45% of the companies included in the survey.

The banking, financial, energy and consultancy services sector provide the highest retirement benefits.

The lowest retirement benefit factor is 50% while the highest is 346%. The average of the minimum benefit factor is 100% while the average of the maximum benefit factor is at 137%. The factors already take into consideration the conversion of the gross salary to basic salary insofar as the number of additional months that salaries are payable in a year.

The survey shows comprehensive statistics on the eligibility requirements and benefit levels for normal and early retirement, vesting, death and disability benefits. Statistics for normal retirement benefits are broken down per industry.

Soft copies of the survey will soon be released to clients and participants. Hard copy of the survey will be included in the actuarial valuation reports provided by ActuarialExponents.

The survey is conducted annually to help clients benchmark the benefits provided in their retirement programs.