An actuarial report assesses the current and future condition of a fund, such as a pension or insurance group, and is prepared by an actuary. It can provide suggestions on how to address problems and offer warning signs about economic problems. The report must be accurate and complete and is signed by the actuary.
An actuarial report is a statement about the current and future condition of a fund, such as a pension or insurance group, to determine if it is on track to meet the needs of its dependents. In the case of public funds such as government employee pensions, actuarial reports are available to members of the public upon request. Private funds have internal reports that may not be accessible. This depends on the fund and the status of the company. In the case of a publicly owned company, actuarial reports may be part of the public filings the company must make to comply with regulators.
This document must be prepared by an actuary. Actuaries have special training in risk assessment, statistical compilation, and demographic assessment. The actuary will analyze the fund’s stated purpose and collect information about contributors to develop an opinion about how much money the fund needs and how much it will have if contributions and disbursements follow expected patterns. Looking at public employee pensions, for example, an actuary would see how much current employees put into the fund, how much the fund earns through investments, and what it pays out to currently retired employees who are entitled to benefits.
The actuarial report will make projections about future performance based on available data. An actuary may note, for example, that a boom in retirees may have a negative impact on a pension fund and could create a situation where there is not enough in the fund to meet the need. An actuarial report can provide suggestions on how to address the problems it identifies. They can also evaluate the outcome of losses and malinvestments to help fund managers develop a plan to stabilize the fund.
Actuaries need as much information as possible to develop accurate and complete actuarial reports. This includes detailed data on projected future needs. If this information is not correct, the statement may be inaccurate and will be less useful to interested managers, investors and members of the public. Actuarial reports can be valuable documents when they are accurate, as they can offer warning signs about economic problems that are not yet visible, but will become a problem in the future.
A complete actuarial report will bear the signature of the actuary preparing it. By signing, you indicate the accuracy of the document and testify that the information is as complete as possible. If the information in the actuarial report is fraudulent, there may be legal penalties.
Smart Asset.
Protect your devices with Threat Protection by NordVPN