高顿网校小编友情提醒您要认真仔细学习——SOA历年真题November2004Course8RC（二）——北美精算师
　　5.(9points)Inordertoattractandretainemployeesinseniorpositions,NOCwantsto
　　introduceterminalfundingbyprovidingtheoptionsofaninsuredannuityoralumpsum
　　benefitfortheNationalOilFull-TimeSalariedSupplementalRetirementPlan(SRP).
　　Thelumpsumwillbeequivalenttothenetpresentvalueoftheafter-taxannualSRP
　　benefit.Theafter-taxpaymentfromtheinsuredannuitywillbeequaltotheafter-tax
　　annualSRPbenefit.NOCwillreimbursethememberforanyimmediatetaxespayable
　　underbothoptions.
　　Youaregiven:
　　?Pat,aseniorexecutiveofNOC,willretirewithanannualpensionundertheSRP
　　of$100,000.
　　?Thebefore-taxdiscountrateusedbyNOCtocalculatelumpsumbenefitsis10%.
　　?LumpsumannuityfactorsatPat’sretirementdateare:
　　Atadiscountrateof10%:9.5
　　Atadiscountrateof6%:13.5
　　?ThecostofbuyingPat’sannuityatretirementis$10forevery$1ofannual
　　benefitpurchased.
　　Gevrey’staxrulesforsinglepremiumannuitycontractsare:
　　?Theemployerobtainsadeductionforanypremiumsitpays;
　　?Theexecutiveisimmediatelytaxedonthefullpurchasepriceoftheannuity;
　　?Aproportionatepartofeachannuitypaymentwouldbedeemedatax-freereturn
　　ofthepremium(“exclusionratio”)andthebalanceistaxableattheindividualtax
　　rate.Forthispurpose,alifeexpectancyof20yearsisused.
　　(a)DescribetheissuesthatNOCmustaddressinadoptingaterminalfunding
　　approach.
　　(b)Calculatethecostdifferentialbetweenthetwoterminalfundingoptions.
　　Showyourwork.
 
　　COURSE8:Fall2004-5-STOP
　　RetirementBenefits,
　　ComprehensiveSegment-Canada
　　MorningSession
　　Questions2–6pertaintotheCaseStudy
　　6.(12points)NOCisproposingthefollowingchangestotheRetireeHealthBenefit
　　programofitssalariedemployees:
　　?EffectiveJanuary1,2004,theprogramwillbeclosedtonewemployees;
　　?Salariedemployeeswithlessthan20yearsofserviceatJanuary1,2004whodo
　　notretirebeforeJanuary1,2005willnotbeeligibleforthebenefitafterthatdate;
　　and
　　?Forallothersalariedemployees,effectiveJanuary1,2005,theportionofthe
　　premiumpaidbytheprogramwillbeinaccordancewiththefollowingschedule:
　　YearsofServiceat
　　Retirement
　　PlanRetiree/Spouse
　　20-2450%50%
　　25-2975%25%
　　30+100%0%
　　NOCwantsananalysisoftheproposedchanges,inrespectofthefollowinggroupsof
　　employees:
　　?GroupA–thesalariedemployeeswhoarecurrentlyeligibleforthebenefitsbut
　　wholosethebenefitsiftheydonotretireinthenextyear;
　　?GroupB–thesalariedemployeesotherthanthoseinGroupAwhoarenolonger
　　eligibletoreceivebenefitsundertheprogram;
　　?GroupC–thesalariedemployeeswhoareeligible,undercurrentassumptions,to
　　receivereducedbenefitsundertheprogram;and
　　?GroupD–thesalariedemployeesnotaffectedbytheproposedchanges.
　　(a)(7points)BasedontheageandservicedistributionoftheNOCFull-Time
　　SalariedPensionPlanatJanuary1,2004,estimatethenumberofsalaried
　　employeesinGroupsA,B,CandD.Identifyanyassumptionsyouusedinyour
　　estimate.
　　(b)(3points)Describeanyspecialaccountingtreatmentsthatareapplicablefor
　　GroupsA,B,CandD.
　　(c)(2points)DescribetheconsequencestoNOCoftheproposedchanges.
　　**ENDOFEXAMINATION**
　　MORNINGSESSION
 
　　COURSE8:Fall2004-6-GOTONEXTPAGE
　　RetirementBenefits,
　　ComprehensiveSegment-Canada
　　AfternoonSession
　　**BEGINNINGOFEXAMINATION8**
　　COMPREHENSIVESEGMENT-CANADA
　　AFTERNOONSESSION
　　Questions7–9pertaintotheCaseStudy
　　高顿网校之考试箴言：九州生气恃风雷，万马齐喑究可哀。我劝天公重抖擞，不拘一格降人才。 —— 龚自珍