MODULES

Aim
The aim of the Pension Funds Course is to generate newly qualified actuaries with the ability to apply the actuarial scientific method and actuarial techniques to the design and financial management of different types of arrangement available for the provision of retirement and related benefits.

Objectives
With reference to the provision of retirement and related benefits in Hungary, the trainee actuary will , on completion of the module , be expected to be able to:

• demonstrate a knowledge of the underlying framework i.e.
• describe the main features of social security provision,
• describe the main forms of occupational and personal pension provision,
• define the principal terms in use in pension provision
• state the principal tax controls,
• describe the legal documents which govern a pension scheme
• describe the basic provisions of Hungarian legislation as it affects occupational and person personal pension arguments,
• describe the economic and demographic factors which affect the cost of provision of pensions,
• describe the principal forms of investment available for pension funds and state the principles of pension fund investment,
• compare and contrast alternative approaches to pension fund provision, including book reserving and pay as you go,
• apply the actuarial philosophy and the actuarial scientific method to the financial management of occupational pension schemes and personal pension arrangements in
• describing valuation data collection and verification procedures,
• analyzing the experience of a defined benefit occupational pension scheme, both with a view to deciding valuation assumptions and to monitoring actual against expected,
• evaluating the liabilities and assets of a defined benefit occupational pension scheme and calculating contribution rates and pension costs, in accordance with the main methods in general use by actuaries,
• analyzing the terms on which individual options should be offered to members,
• determining bulk transfers,
• establishing the impact of the liabilities of a defined benefit occupational pension scheme on the choice and management of assets
• determining and monitoring the level of contribution for a personal pension contract or group defined contribution arrangement,
• analyze straightforward problems in terms of the actuarial scientific method, to a level where they may be processed by appropriate actuarial techniques, i.e.
• analyze the effect of different methods of calculating contribution rates and pension costs and alternative economic and demographic assumptions,
• determine appropriate bases for valuing the assets and liabilities of a defined benefit occupational
• pension scheme and calculating contribution rates and pension costs
• determine appropriate bases for analyzing the terms on which individual options should be offered to members, and for calculating bulk-transfers,
• analyze the asset-liability matching requirements of a pension scheme and show how techniques may be used to develop appropriate strategies.