The BBS actuarial funding modeller
To help pension scheme trustees and sponsoring employers through the difficult process of choosing assumptions for an actuarial valuation, BBS has produced an actuarial funding modeller. This helps you ensure that your chosen investment strategy can be expected to deliver the long-term returns needed to match the valuation assumptions.
It is often difficult for trustees and sponsors to gauge the effects of differing assumptions without doing detailed calculations, which can be very time consuming. It can also be difficult to understand the relationship between:
- the discount rates used to calculate a scheme’s technical provisions (liabilities); and
- the underlying returns required on different asset classes if the valuation assumptions are to be met in practice.
The BBS funding modeller was created to solve both of these problems. As well as helping trustees with the valuation process and setting their investment strategy, the modeller can be of great benefit to the sponsoring employer and any other parties who are looking to gain a better understanding of the impact of the key assumptions used for the valuation.
How the BBS actuarial funding modeller works:
- users can easily convert the results of a valuation from one actuarial basis to another
- the modeller projects the future funding position, based on the assumptions set - and an assumed future level of contributions
- alternatively, the modeller can use the projections to work backwards and calculate the contributions required in order to eliminate a deficit over a specified period of time
- a number of alternative asset models can be incorporated, including the ability to match assets against a specified proportion of the liabilities
- output is primarily in graphical form, for easy analysis, with the underlying figures easily accessible, if required
For more information on how the BBS actuarial funding modeller could benefit you and your scheme, please click here to make an enquiry.