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ASSET-LIABILITY MANAGEMENT SERVICE

 

Effective immediately, ActuarialExponents will make asset-liability management studies for retirement funds available to its clientele.

 

Asset-liability management aims to match the duration of assets against expected retirement benefit payouts to minimize the risks to the company but still achieve optimum return. ActuarialExponents' asset-liability management study will also include information on the risk-return characteristics of the matched investment portfolio.

 

Another objective of offering this service is for clients to be able to disclose in their financial statements that an asset-liability matching strategy is being employed. It should be noted that the Amended IAS 19 gives a lot of emphasis on the risks to the company relative to its defined benefit plan. It requires companies to disclose risk-mitigating practices such as asset-liability management, the effect to the liability of changes in major actuarial assumptions (discount rate, attrition rate, salary increase rate), among others.