Current issues in pensions financial reporting Q2 2024

Our latest briefing is for those involved in preparing and auditing pension disclosures under Accounting Standards FRS102 (UK non-listed), IAS19 (EU listed) and ASC715 (US listed) as at 30 June 2024. 

Top insights

• IAS19 liabilities increase, but balance sheet impact positive - Since 30 June 2023, most schemes have seen the value of their IAS19 liabilities increase, with corporate bond yields falling by around 0.25% per annum compared to last year.
• Impacts on balance sheet is likely to be positive - Whilst the increase on the liability value will not be welcome to corporate sponsors, the overall impact on the net balance sheet is likely to be positive due to strong asset returns over the period.
• Surpluses, IFRIC14 and asset ceilings - The changes in funding levels mean many schemes may continue to find themselves with accounting surplus at the next balance sheet date. Some schemes may also find that the accounting position is materially better than the scheme funding position used to determine the last recovery plan contributions, increasing the chances of additional liabilities being required under IAS19 (even if a deficit remains).

We'll also explore topics such as

• Discount rates;
• developments in inflation; and
• mortality projections.