• Current students
      • Student centre
        Enrol on a course/exam
        My enrolments
        Exam results
        Mock Exams 2020/21
        CAP1 essential documents
        CAP2 essential documents
        FAE essential documents
      • Course information
        Students FAQs
        Student induction
        Course enrolment information
        Key dates
        Book distribution
        Timetables
        FAE Elective Information
      • Exams
        Exam Info: CAP1
        E-assessment information
        Exam info: CAP2
        Exam info: FAE
        Reasonable accommodation and extenuating circumstances
        Timetables for exams & interim assessments
        Interim assessments past papers & E-Assessment mock solutions
        Main examination past papers
        Information and appeals scheme
        JIEB: NI Insolvency Qualification
      • CA Diary resources
        Mentors: Getting started on the CA Diary
        CA Diary for Flexible Route FAQs
      • Admission to membership
        Joining as a reciprocal member
        Conferring dates
        Admissions FAQs
      • Support & services
        Audit Qualification requirements
        Recruitment to and transferring of training contracts
        CASSI
        Student supports and wellbeing
        Learning Hub data privacy policy
    • Students

      View all the services available for students of the Institute

      Read More
  • Becoming a student
      • About Chartered Accountancy
        The Chartered difference
        What do Chartered Accountants do?
        5 Reasons to become a Chartered Accountant
        Student benefits
        School Bootcamp
        Chartered Connect
        Study in Northern Ireland
        Events
        Blogs
        Testimonials of Flexible route
      • Entry routes
        College
        Working
        Accounting Technicians
        School leavers
        Member of another body
        International student
        Flexible Route
        Training Contract
      • Course description
        CAP1
        CAP2
        FAE
        New education offering
      • Apply
        How to apply
        Exemptions guide
        Fees & payment options
        External students
      • Training vacancies
        Training vacancies search
        Training firms list
        Large training firms
        Milkround
        Training firms update details
        Recruitment to and transferring of training contract
        Interview preparation and advice
        The rewards on qualification
        Tailoring your CV for each application
        Securing a trainee Chartered Accountant role
      • Support & services
        Becoming a student FAQs
        Who to contact for employers
        Register for a school visit
    • Becoming a
      student

      Study with us

      Read More
  • Members
      • Members Hub
        My account
        Annual subscription fees
        Annual returns
        Application forms
        CPD/events
        Member services A-Z
        District societies
        Professional Standards
        Young Professionals
        Advocacy
        Careers development
      • In practice
        Going into practice
        Practice Matters
        Practice toolkits
        Members in practice committee
        Practice networks
        Helpsheets
        Compliance support
        Members' complaints adviser
        Free services
        Our approach
        Workshops and professional training with a difference
        Abhaile Scheme
        Practice News webinars
        GDPR resources for practices
      • Overseas members
        Working abroad
        Working in Australia
        Overseas members news
        Tax for returning Irish members
      • In business
        Networking and special interest groups
        Articles
      • Public sector
        Public sector news
        Public sector presentations
      • Support & services
        Letters of good standing form
        FAQs for Chartered Accountants
        AML confidential disclosure form
        CHARIOT/Institute Technical content
        TaxSource
        Pocket diaries
    • Members

      View member services

      Read More
  • Employers
      • Training organisations
        Authorise to train
        Training in business
        Course enrolment information for firms
        Manage my students
        Incentive Scheme
        Recruitment to and transferring of training contracts
        Securing and retaining the best talent
        Tips on writing a job specification
      • Training
        In-house training
        Training tickets
      • Recruitment services
        Hire a qualified Chartered Accountant
        Hire a trainee student
      • Non executive directors recruitment service
      • Support & services
        Hire members: log a job vacancy
        Firm/employers FAQs
        Training ticket FAQs
        Authorisations
        Hire a room
        Who to contact for employers
    • Employers

      Services to support your business

      Read More
☰
  • The Institute
☰
  • Home
  • Articles
  • Students
  • Advertise
  • Subscribe
  • Archive
  • Podcasts
  • Contact us
Search
View Cart 0 Item
  • Home/
  • Accountancy Ireland/
  • Articles/
  • News/
  • Latest News

Lastest news

AS TM1 assumptions to remain unchanged

Jun 05, 2019
The FRC has conducted a review of the assumptions set within Actuarial Standard Technical Memorandum 1 (AS TM1) that are mandated for use in the annual Statutory Money Purchase Illustrations (SMPIs) received by people saving for retirement in defined contribution pension plans. Each year there are over 30 million SMPIs produced in respect of these defined contribution plans.

The FRC concluded that no change will be made to the assumptions and that the current version (V 4.2) will remain in force for SMPIs produced in the year beginning 6 April 2020. The main reasons for this conclusion are:
 
  • The existing assumptions remain within a reasonable range so that change is not required urgently and there is value in consistency from year to year;
  • The Pensions Dashboard has the support of industry and government. It is progressing and is intended to bring together all pension rights of each person in one place. This has the potential to revolutionise the way that projections are performed and presented in ways that are difficult to predict currently;
  • The Continuous Mortality Investigation (CMI) is anticipating that next year they will issue a new base table for mortality and are looking to increase the flexibility available to users of their mortality tables. It is uncertain what impact this may have on the annuity market in practice;
  • The UK's EU exit continues to remain a source of uncertainty to economic conditions and makes economic and fiscal prediction more difficult and potentially more volatile; and
  • Pensions Freedoms have fundamentally impacted the nature of pensions saving. Annuities are currently much less popular than previously (partially because of the high cost associated with them in low interest times and partially because Pensions Freedoms allow people access to their funds in more immediate ways).  The annuity market has contracted but it is too uncertain to know whether annuities will become popular once more if and when fixed interest yields rise.
Given these initiatives and uncertainties, it was concluded that now is not the time to make changes to the AS TM1 assumptions.

As such, the current version of AS TM1 (version 4.2) will remain in force until further notice. However, as the above initiatives progress, it will be important for their impact to be reflected in subsequent versions of the pension projection assumptions.

The FRC has responsibility to set and maintain the assumptions used to produce the Statutory Money Purchase Illustrations (SMPIs) sent annually to individuals who have Defined Contribution (DC) pension plans.

To meet this responsibility FRC reviews the assumptions in AS TM1 which governs these illustrations against the background of current and anticipated economic and demographic experience. In addition, we monitor those assumptions in which providers have a degree of flexibility (for example the choice of accumulation rates to be used in the projection).

For more information contact astm1@frc.org.uk.

Published: 5 June 2019.

Source: Financial Reporting Council.

The latest news to your inbox

Useful links

  • Current students
  • Becoming a student
  • Knowledge centre
  • Shop
  • District societies

Get in touch

Dublin HQ

Chartered Accountants
House, 47-49 Pearse St,
Dublin 2, Ireland

TEL: +353 1 637 7200
Belfast HQ

The Linenhall
32-38 Linenhall Street, Belfast
Antrim BT2 8BG, United Kingdom.

TEL: +44 28 9043 5840

Connect with us

CAW Footer Logo-min
GAA Footer Logo-min
CARB Footer Logo-min
CCAB-I Footer Logo-min

© Copyright Chartered Accountants Ireland 2020. All Rights Reserved.

☰
  • Terms & conditions
  • Privacy statement
  • Event privacy notice
LOADING...

Please wait while the page loads.