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Company Reporting is a monthly journal available in both paper and on the web which monitors the financial reporting practices of UK companies. It is available on subscription only, and a sample copy of the paper version can be obtained from Edinburgh based research organisation Company Reporting Ltd.

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News Release

For immediate release

Equity pension assumptions move in opposite directions

Berkeley Berry Birch's expected rate of return on equities rises to 9% while Associated British Engineering cuts its rate to 5.1%. For two companies with similar year ends faced with the same market conditions, Company Reporting is surprised to see them move in such different directions.
Under FRS 17 "Retirement benefits", companies have substantial freedom in how they set expected investment returns. Recent analysis of FRS 17 disclosures by Company Reporting indicated that the average expected rate of return for equities is 7.8%. However, it is anticipated that the IASB will move away from long-term averages and focus on current market conditions. This would debar the use of such high assumptions in future.