Category: Benefits

The IRS recently issued Revenue Ruling 2003-83 which provides guidance on reasonable funding methods for pension plans. (Also, via Benefitslink here.)

Reuters via Lycos reports: “GM Opposes Pension Disclosure Changes.” The article quotes GM spokeswoman Toni Simonetti as saying: “The proposed new rule assumes you have one defined benefit plan. If you’re a multinational and you have several plans, it’s virtually impossible to comply with the (new) rule.”

Scott Burns reports here for the Houston Chronicle: “Bush tax cuts similar to printing more money.”

This article–“Enron pushing for inexpensive mediation decision”–by Mary Flood and Eric Berger for the Houston Chronicle reports on the mediation efforts going on in the Enron bankruptcy and civil litigation cases today.

“Exec Stock Options: Put ‘Em to a Vote: SEC will require companies to get shareholder approval for stock-option grants. Elsewhere: . . FASB wants quarterly DB reports”: David M. Katz for CFO.com reports here. The article discusses how the Securities and Exchange Commission is expected to adopt a rule today requiring all companies whose shares are traded on U.S. stock exchanges to obtain shareholders’ approval for executive stock compensation packages.

Kara Scannell for today’s edition of the Wall Street Journal provides this: “Revenues at Law Firms Rise 8.5%, Aided by Diversification and Cuts.” The article reports on the American Lawyer magazine‘s annual survey which found that “gross revenues at the 100 biggest law firms rose 8.5% to $38 billion in 2002, helped by diversified-practice groups, cost cutting and higher billing rates.” Does anyone else find it disturbing that when economic times are tough, law firms raise their billing rates? . . .

Today’s Federal Register is here.

“Fed explains tricky rules on reporting pension plan health”: Pacific Business News has this regarding a report issued by Simon Kwan for The Federal Reserve Bank of San Francisco this week explaining “how current accounting practices for corporate pension funds blur reality.”

Another very interesting article by Richard Bernstein for the New York Times on how demographics is making pensions an “urgent political issue” in Europe: “Aging Europe Finds Its Pension Is Running Out.” The article discusses how in Europe the population is both living longer and producing fewer children which is beginning to change some of the fundamentals of both social and political life. The article discusses a study by William Frey, a demographer at the Brookings Institution in Washington, which predicts that the median age in the United States in 2050 will be 35.4, only a very slight increase from what it is now. In Europe, by contrast, it is expected to rise to 52.3 from 37.7. The article states: “The likely meaning of this “stunning difference,” as the British weekly The Economist called the growing demographic disparity between Europe and the United States, is that American power–economic and military–will continue to grow relative to Europe’s, which will also decline in comparison with other parts of the world like China, India and Latin America.”

Kris Frieswick for CFO.com reports: “Age Discrimination Snags Lurking in Pension Rules: New federal pension rules are drawing fire from both sides of the cash-balance plan debate.”

This report by Jonathan Weil for the Wall Street Journal: “More frequent disclosures on the way for US pension plans.” The article reports on FASB’s decision last week to require US companies to disclose the impact, in dollar amounts, that the various parts of their pension plans have on each quarter’s earnings. The article states that ”[r]eaders of a public company’s financial statements would also be able to see for the first time the degree to which various line items on a company’s income statement were boosted or dragged down by pension-plan activities.”

Today’s Federal Register is here.

“Fed explains tricky rules on reporting pension plan health”: Pacific Business News has this regarding a report issued by Simon Kwan for The Federal Reserve Bank of San Francisco this week explaining “how current accounting practices for corporate pension funds blur reality.”

Another very interesting article by Richard Bernstein for the New York Times on how demographics is making pensions an “urgent political issue” in Europe: “Aging Europe Finds Its Pension Is Running Out.” The article discusses how in Europe the population is both living longer and producing fewer children which is beginning to change some of the fundamentals of both social and political life. The article discusses a study by William Frey, a demographer at the Brookings Institution in Washington, which predicts that the median age in the United States in 2050 will be 35.4, only a very slight increase from what it is now. In Europe, by contrast, it is expected to rise to 52.3 from 37.7. The article states: “The likely meaning of this “stunning difference,” as the British weekly The Economist called the growing demographic disparity between Europe and the United States, is that American power — economic and military — will continue to grow relative to Europe’s, which will also decline in comparison with other parts of the world like China, India and Latin America.”

Kris Frieswick for CFO.com reports: “Age Discrimination Snags Lurking in Pension Rules: New federal pension rules are drawing fire from both sides of the cash-balance plan debate.

This report by Jonathan Weil for the Wall Street Journal: “More frequent disclosures on the way for US pension plans.” The article reports on FASB’s decision last week to require US companies to disclose the impact, in dollar amounts, that the various parts of their pension plans have on each quarter’s earnings. The article states that ”[r]eaders of a public company’s financial statements would also be able to see for the first time the degree to which various line items on a company’s income statement were boosted or dragged down by pension-plan activities.”

Christine Dugas for USAToday via Yahoo! News.com reports: “Enron hit with federal lawsuit.” The article reports Ann Combs, assistant secretary for the Employee Benefits Security Administration, as saying that the DOL has been under pressure by some in Congress to hold corporations accountable for retirement plan losses and that it has launched investigations into WorldCom and Global Crossing. Combs says her office won’t be pressured to bring a case until it is ready. In addition the article reports: “Because the department is in charge of interpreting and applying pension law, its lawsuit puts more pressure on the defendants to settle, some experts say.”

Read more about the Enron litigation in previous posts here . . .

“401(k) shifting to back burner”: Albert B. Crenshaw for the WashingtonPost via the Seattle Times reports on a study by Hewitt Associates, Inc., which showed that “last year, as the market plunged, millions of American workers essentially blotted their 401(k) plans out of their minds.”

Peter Behr for the WashingtonPost.com reports: “Flood of Fees Draining Enron Funds: $496 Million in Charges Rung Up So Far by Lawyers, Others.”

Reuters has this via Yahoo! News.com: “SEC May Order Holder Stock-Pay Plan Votes.”