Today’s Federal Register is here.
Lee Berton, a journalist and a consultant to the accounting department of the City University of New York’s Baruch College, writes this article at Bloomberg.com: “Pension Accounting Rules Create False Profits.” The article reports that companies do not have to “practice fraud to create suspect earnings,” but merely have to follow accepted pension accounting standards to do so. The article criticizes rules which “permit a company to assume appreciation on pension portfolio assets, even though sharp stock market declines have decimated the portfolio’s value.” FASB is seeking to revamp pension accounting rules which can be read about in previous posts here.
This article by Rachel Beck at Newsday.com discusses the effect falling interest rates have on pension funding: “Interest Rates Prolong Pension Woes.” The article points out that FASB is beginning to look into requiring quarterly, instead of annual, pension disclosures in order to avoid annual investor “sticker shock.”
This article–“Investing with Safety”–at KansasCity.com reports on the study by Hewitt Associates Inc. (discussed here yesterday) indicating the three most popular places participants are putting their 401(k) money while stocks are suffering: money market funds, bond funds, and stable value funds.
Also, this very good article by Sharon Epperson at Time.com on a new disability insurance product which is becoming more popular: “Saving Your Nest Egg: Retirement funds suffer if you go on disability–An insurance policy can help.” The article discusses group and individual disability insurance products which cover employee contributions and employer contributions to a defined contribution plan, if the individual becomes disabled.