IAS 19 - Employee Benefits Actuarial Valuation

FIRIS has established experience in employees benefits in accordance to IAS19 as well as Vietnamese regulations. We can help you satistfy financial reporting requirements under standards by performing a periodic actuarial valuation of your employee benefits, including end-of-service benefits, long-service awards and other existing defi  ned benefit plans. 

Defined benefit plans are classified as post-employment plans where the obligation of the entity is to provide the agreed benefits to current and former employees, usually based on some benefit formulas. Under benefit plans actuarial risk and investment risk fall, in substance, on the entity. If actuarial and investment experience is worse than expected, the entity’s obligation may be increased.

Actuarial valuation for defined benefit plans involves the following steps:

• Determine how much benefit is attributable to the current and prior periods.
• Make actuarial assumptions about demographic variables, such as mortality, turnover, ill health and early retirement and financial variables, such as discount rate, future salary and benefit levels that will affect the cost of the benefits.
• Use the Projected Unit Credit Method to calculate the present value of the defined benefit obligation for the benefit attributable to prior periods, and the current service cost for the benefit attributable to the current period.
• Determine the total amount of actuarial gains and losses and the amount of those actuarial gains and losses to be recognized.
• Where a plan has been introduced or changed, determine the resulting past service cost and the amount to be recognized.
• Where a plan has been curtailed or settled, determine the resulting gain or loss.

FIRIS will help your company in