LETTERS TO THE EDITOR

摘要

I read James Adams and Donald Smith's article (July/August 2009) with interest because it treats a subject that occupies much of my working day. My interest gave way to concern, however, as I read the authors' work. I was surprised to see that the duration of the accumulated benefit obligation (ABO) was 17.1 years whereas the projected benefit obligation (PBO) was just 8.4 years. Not only is this difference a big one-and a short duration even for a U.S. plan-but it is also different from what I would expect.rnDuration has a prosaic definition: It is the length of a series of cash flows. Pension fund cash flows have an "armadillo" shape, rising rapidly in the early years as members retire and new pensions start and then gradually tailing off, in line with actuarial assumptions about mortality.