- This topic has 3 replies, 2 voices, and was last updated 5 years ago by
.
Viewing 4 posts - 1 through 4 (of 4 total)
- Posts
Hello sir, which is the correct rate to use in calculation of net interest calculation.
For instance if we are given two rates
1. for obligation 8%
2. expected return on plan asset 10%another example
1. for obligation 7%
2. expected return on plan asset 5%My question is for calculation of interest on obligation it is clear we use return on high quality bond(i.e. 1). However in calculation of interest on plan asset which rate to use?
Further in some solution( relating to second example) 7% is used for plan assets return. What might be the rationale?
😀If the question has been properly updated, you should be using the same rate for assets and liabilities. This will be yield on high quality bonds.
(The rules used to be different).
Viewing 4 posts - 1 through 4 (of 4 total)
- The topic ‘Employee Benefit Discount rate’ is closed to new replies.