SORP

Inclusion of Actuarial Liabilities in the Financial Statements of Pension Schemes - A Consultation Paper   

At the request of the Accounting Standards Board ("ASB"), PRAG has carried out a consultation process regarding the inclusion of actuarial liabilities within the Financial Statements of Pension Schemes.  This consultation process involved, the PRAG "SORP" Working Party issuing a 12 page consultation paper in November 2002.  The consultation period closed 28 February 2003 and the Working Party have now collated the responses.

An overview of the responses is now available.  Click here to download the file in PDF format (File size: 143 k).

In collating the responses, the Working Party grouped them under three heads and the responses are available to members in the members' area of the SORP Working Party.

A copy of the consultation paper is still available - Click here to download the file in PDF format (File size: 132 k).

 

Copies of the SORP are available as detailed below.

(An electronic version of the SORP will not be available on the Internet.)

Statements of Recommended Practice ("SORPs") are recommendations on accounting practices for specialised industries or sectors.  They supplement accounting standards and other legal and regulatory requirements in the light of the special factors prevailing or transactions undertaken in a particular industry or sector.  SORPs are issued not by the Accounting Standards Board ("ASB") but by industry or sectoral bodies recognised for the purpose by the ASB.  PRAG is recognised by the ASB as the appropriate body within the pensions industry for issuing statements of recommended practice governing the form and content of financial statements for pension schemes.

In 1996, PRAG published its first SORP setting out best practice for the financial statements of pension schemes.  PRAG is required to keep SORP up to date having regard to changes in legislation and Financial Reporting Standards.  Due to changes affecting financial reporting since 1996, the PRAG "SORP" working party issued an exposure draft for a new SORP in early 2002 following which a revised SORP was issued in November 2002.

In addition to establishing best practice, the document also explains the context in which it has been assumed the financial statements will be placed and offers advice and suggestions on improving the quality of communication within the annual report as a whole.  The additional commentary and advice are not part of the formal guidelines constituting the Statement of Recommended Practice.

SORPs set out recommended rather than mandatory practice.  However, current pension regulations in the UK and the Republic of Ireland require schemes to disclose whether they have complied with the SORP and to explain and justify any material departure from the SORP.

Copies of the document can be obtained from Wolters Kluwer (UK) Ltd.  For details of how to order, please visit our Publications page

 

PRAG regrets it is unable to offer advice on individual cases.  Please refer to your auditors for detailed guidance.