IAS 19 and US GAAP – how they work

IAS 19 and US GAAP are international regulatory frameworks for accounting of defined-benefit pension promise. The work is based on a close dialogue with you as a client, which simplifies practical management and makes it efficient.

Generally, the work involved in conducting IAS 19 and US GAAP valuations follows an annual cycle which can be divided into five steps.

Agreement and planning

“In the first step, the basic conditions for the cooperation are formulated and a joint timetable for the service is established,” explains Claes Nilsson Kvick, Manager of Actuarial Services.

The assumptions and other information

This step is based on a close dialogue with you the client. A current interest rate curve is generated, as is a calculation of the company’s duration, which serves as a basis for establishing a discount rate.

“The dialogue also includes a discussion regarding other assumptions included in the calculation. We usually also update ourselves regarding special events that have occurred in the corporate group which may affect the result,” explains Claes Nilsson Kvick.

Actuarial calculation

In the next step, the actuarial calculation is carried out based on the company’s current information.Reporting

Based on the calculation, the result is analysed and compiled. The reports show the effect that the valuation may have on the income statement and balance sheet, as well as other comprehensive income (OCI).


“Communication is always important,” concludes Claes Nilsson Kvick. During the entire process, we maintain a close dialogue to ensure that both the company and auditors receive answers to any questions and concerns.