4 Questions to Ask About Private Pensions

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What only excerbates this situation for those of us whose employer has moved from a DB plan to a 401k, is that we as taxpayers are still on the hook to support public pension plans, which have also taken a hit during this market downturn. Worse, the definition of funded in the realm of public pensions is defined more on a pay-as-you-go basis versus on an accrual basis for private plans, so many of the public plans were underfunded before the financial crisis. We have created a 2 tiered retirement system which is grossly unfair to private sector employees.

JJS of CT 1:37PM September 08, 2009

for thoughtfully taking on yet another complex and IMPORTANT subject.
I come from a background in accounting. And it's my opinion that the public accounting industry woefully failed the general "public" with respect to pension plan disclosures, just as the rating agencies (S&P, Moody's) failed the public with the wrong but spify ratings they put on various mortgage-backed bonds at the root of the recent financial crisis.
The CPA's "audit" pension plans all the time---and they seem to routinely accept most any "assumptions" (estimates of discount or gain rates in the future) that any enrolled actuary (hired by the PLAN itself) chooses to use.
The "i"s are dotted and the "t"s are crossed, the reports come in nice binders, and we're all left generally clueless as to whether the projections are even close to "reasonable".

Muser of NM 12:06PM September 04, 2009