SLIDE 1 DB System Enhancements for Schedule SB 4/16/2009 (c) 2009 DATAIR 1 1
Defined Benefit System Enhancements: Schedule SB, Discounting Contributions, Carry Over and Pre-Funding
Aaron Venouziou, EA John Baratka, EA
Dave Roper Sue Evans, EA
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Items to be covered today…..
System Enhancements for Schedule SB
– “Discounting Contributions” Worksheet
Examples Printouts
– Rate of Return (ROR) Calculator
Examples
Updating for 2009 Valuations
– Carry Over Balance (COB) – Pre-Funding Balance (PFB)
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“Discounting Contributions” Worksheet
Example #1 – No quarterly contribution requirements,
no prior year credit balance (CB) or funding deficiency
Example #2 – Quarterly contributions (some late, some
Example #3 – Utilization of the CB for satisfying
quarterly contribution requirements
Example #4 – EOY vs. BOY valuation date Exceptions
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Discounting Contributions Worksheet
Example #1 – No quarterly contribution requirements,
no prior year credit balance (CB) or funding deficiency
Values from current year valuation report
–
Minimum contribution (Valuation Results – C6, $87,997)
–
Effective Interest Rate (Valuation Results – Top of Page 1, 5.92%)
–
Prior year credit balance at the beginning of the year (Valuation Results – A5, $50,783)
Values from prior year valuation report
–
Prior year minimum contribution (Valuation Results – C6)
–
Prior year funded status (Valuation Results – Funded current liability percentage is greater than 100%)
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Current Year Valuation Results
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Current Year Valuation Results
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Discounting Worksheet: Example 1
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Discounting Worksheet: Example 1
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Discounting Worksheet: Example 1
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Discounting Worksheet: Example 1
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Discounting Worksheet: Example 1
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Discounting Contributions Worksheet
Example #2 – Quarterly contributions (some late,
some on time)
Quarterly Requirement $19,799 Enter dates and amounts of contributions made to date Entering more than the minimum required contribution
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Carry Over Balance
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Discounting Worksheet: Example 2
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Discounting Worksheet: Example 2
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Discounting Worksheet: Example 2
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Discounting Worksheet: Example 2
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Discounting Worksheet: Example 2
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Discounting Contributions Worksheet
Example #3 – Utilization of the CB for satisfying
quarterly contribution requirements
Enter the CB on the last day of the 2007 plan year (Valuation
Results – A5, $50,783)
Indicate whether or not to apply all or any portion of the CB to the
current year contribution requirements
If yes, enter the dates and amounts of the CB to apply based on
the prior year contributions that created and/or increased the CB
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Discounting Worksheet: Example 3
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Discounting Worksheet: Example 3
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Discounting Worksheet: Example 3
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Discounting Worksheet: Example 3
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Discounting Worksheet: Example 3
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Discounting Contributions Worksheet
Example #4 – EOY vs. BOY valuation date
Note that the discounted contributions are at the valuation date
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Discounting Worksheet: Example 4
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Discounting Worksheet: Example 4
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Discounting Worksheet: Example 4
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Discounting Worksheet: Example 4
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Discounting Worksheet: Example 4
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Rate of Return Calculator
Where to find it
– Utilities Menu (B) – Rate of Return (F)
How to Use it
– Add/Change Plan – Period and Asset Values – Transactions
Money In: Contributions, Surrendered Insurance, Rollovers Money Out: Benefit Payments, Insurance Premiums, Return of
Excess
– Viewing/Printing the Results
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Rate of Return Calculator
Old IRS method of determining the ROR is out ! New cash basis method is in !
1.
Enter the cash basis, asset value at the beginning of the year. Do not include contributions receivable for the previous plan year.
2.
Enter dates and amounts of contributions made during the year. Be sure to include amounts contributed during the year that were for the previous plan year.
3.
Enter dates and amounts of distributions made during the year.
4.
Enter the asset value at the end of the year. Do not include contributions receivable for the year.
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Rate of Return Calculator
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Rate of Return Calculator
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Rate of Return Calculator
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Rate of Return Calculator
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Rate of Return Calculator
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Rate of Return Calculator
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Rate of Return Calculator
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Updating for 2009 Valuations
Carry Over Balance Pre-Funding Balance Beginning of Year Valuation Date End of Year Valuation Date
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Carry Over Balance
Components for the Calculation
D41 = Credit balance at the end of the prior plan year S180 = Rate of Return S611 = Portion of the prior year credit balance to be
used for the current year minimum contribution requirement
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BOY Valuation Date Carry Over Balance
Carry Over Balance at BOY Amount Used for Current Year Net Carry Over Balance at BOY (1 + Rate of Return) New Carry Over Balance
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EOY Valuation Date Carry Over Balance
Carry Over Balance at BOY (1 + Effective Interest Rate) End of Year Carry Over Balance Amount Used for Current Year Net Carry Over Balance at EOY (1 + Effective Interest Rate) Net Carry Over Balance at BOY (1 + Rate of Return) New Carry Over Balance
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Carry Over Balance ROR
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