The Auditors' prespective on Actuarial Valuation - In the light of Accounting Standard - 15 (revised 2005)

1. ACCOUNTING STANDARD 15 (EMPLOYEE BENEFITS)THE AUDITORS’ PERSPECTIVE Prepared by : GauravSehgal

3. Formal plans or agreements of companies with employees;

4. Legislative or industry requirements;

5. Informal practices that give rise to an obligation;

6. Whether paid to the employees, family, nominees or any trusts, insurance companies or association on their behalf.

7. The standard classified benefits into four categories:

8. Short term employee benefits;

9. Post employment benefits;

10. Other long term employee benefits;

13. Using Projected Unit Credit Method (PUC) to determine the present value of defined benefit obligation and current service cost;

14. Determining the fair value of plan assets;

15. Determining the amounts of actuarial gains and losses;

16. In case of change of plan, the resulting past service cost;

19. Financial assumptions such as discount rate, future salary and benefit levels, future medical costs, expected rate of return on plan assets, etc should be based on market expectations

20. Demographic assumptions like mortality rate, rate of employee turnover, disability, early retirement, proportion of plan members with eligible dependents, claim rates under medical plans, etc should be reliable

21. Discount rate should be determined with reference to market yields at the Balance Sheet date on Government Bonds and its currency and term should be consistent with that of the plan

28. COMPARISON BETWEEN AS 15, Ind AS 19 AND IAS 19

29. COMPARISON BETWEEN AS 15, Ind AS 19 AND IAS 19

30. COMPARISON BETWEEN AS 15, Ind AS 19 AND IAS 19

31. COMPARISON BETWEEN AS 15, Ind AS 19 AND IAS 19

32. THANK YOU