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Pension cost rule may give new reason to de-risk plans

Tammy Whitehouse | October 23, 2017

A new accounting rule taking effect on the presentation of pension costs will serve as yet another nail in the coffin of defined benefit pension plans as a form of employment compensation.

That’s the conclusion of the asset management group at Goldman Sachs, which reports the rule change will give defined benefit plan sponsors a new reason to de-risk any plans they still offer or carry on their books.

The Financial Accounting Standards Board adopted Accounting Standards Update No. 2017-01 in early 2017 to take effect for plan years beginning after Dec. 31, 2017. That means calendar year-end companies will begin applying the new accounting on Jan. 1,...

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