Valuation Consulting

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VALUATION CONSULTING

Valuation Consulting and Support Services for Qualified Defined Benefit Pension Plans

Cowden Associates, Inc. is often asked to perform consulting services regarding defined benefit pension plans. These plans can take on a variety of forms, ranging from a straightforward final average pay program to a cash balance plan. We prepare the annual required funding valuation reports, including financial data required; review a sampling of retirement benefit calculations; prepare PBGC premium calculations; perform normal and routine audit support for ASC 715 and 960; and the required Schedule SB (Form 5500). Our support in this area extends beyond routine services by constantly working with plan sponsors on various projections and analyses, as well as “what-if” scenarios. Our proactive approach has enabled us to identify various design changes and assumption alterations to minimize issues and prepare the organizations for any pending impacts. We also participate in analyst calls to explain issues in detail and address concerns regarding pension issues and related matters, including possible accounting, cash-flow and balance sheet matters.

Valuation Consulting and Support Services for NonQualified Defined Benefit Pension Plans

As noted above, we perform all of the steps required for a plan sponsor to evaluate nonqualified defined benefit plans. These services include plan design, potential plan participants, expense, cash flow and estimated participant benefits. Unlike qualified plans, nonqualified defined benefits plans, primarily Supplemental Executive Retirement Plans (SERPs), do not require annual funding valuations, but do require the same data for financial statement purposes that is used for qualified plan purposes. As such, we prepare the required financial statement data. Companies often do not realize the importance of managing their SERP liabilities. Cowden is frequently contacted to provide plan redesign consulting services. This area includes the full range of altering plan formulas, choosing appropriate actuarial assumptions and benefit offsets, as well as attempting to maximize qualified plan benefits.

Valuation Consulting and Support Services for Retiree Medical and Life Obligations

Companies are required to account for their retiree medical and life obligations (commonly referred to as OPEB), in a manner consistent with defined benefit pension plans. As a result, our typical engagement in this area includes the preparation of the required accounting information, as well as cash-flow forecasts. Again, our assistance in this area goes beyond the traditional valuation services. As companies are faced with a growing number of retirees, escalating healthcare costs, and financial statement pressures, we often are engaged to provide various consulting services to assist in attempting to minimize or contain this issue. Our assistance in this area crosses over from the traditional valuation services and becomes a benefits consulting arrangement. We can perform the following actuarial services and more:
  • Develop Annual Contribution Requirements
  • Calculate Funding Status
  • Prepare Information for Auditor Requirements
  • Prepare Information for Government Forms
  • Certify Actuarial Methods and Assumptions
  • Develop Annual Expense and Financial Disclosures
  • Prepare ASC 715 disclosures
  • Actuarial information needed under GASB 25, 27, 43, 45, 47 and 75
  • Prepare ASC 965
  • Produce Annual Retirement Benefit Statements
  • Compose Comprehensive Participant Benefit Statements
  • Devise Benefit Change Communications
  • Develop Funding Notices
  • Generate Summary Plan Descriptions
  • Create Legislative and Compliance Assessment
  • Monitor Federal Regulations
  • Prepare and File Government Forms
  • Generate Cash/Expense Projections
  • Prepare Asset/Liability Modeling
  • Generate Budget Forecasts
  • Create Retirement Strategy
  • Create Plan Design
  • Implement Strategic Planning
  • Produce Benchmarking
  • Create Certification of Retirement Benefits
  • Prepare Signature Ready Forms
  • Prepare Relative Value Disclosures
  • Perform Lump Sum Calculations
  • Prepare Cash Management
  • Compose Employee Communications
  • Devise Replacement Plans
  • Perform Annuity Placements