Pension work: funding, solvency and accounting are separate valuations
A defined-benefit pension valuation estimates benefits promised by the plan. The result depends on the purpose and applicable jurisdiction; “the pension liability” is not always one number.
Three questions to separate
- Going-concern funding: what contributions support the plan on its continuing basis under applicable rules?
- Solvency or wind-up measures: what does the specified settlement or termination basis require?
- Sponsor accounting: what expense and obligation should the sponsor report under its accounting standard?
Do not copy a discount rate from one basis into another without checking the purpose and requirements. OSFI’s actuarial-report guidance concerns federally regulated plans, not every Canadian pension plan.
The analyst’s working file
Reconcile membership and asset data, validate service and pension amounts, implement benefit provisions, calculate results and prepare gain/loss explanations. Missing retirement dates or an incorrectly coded early-retirement provision can matter more than an extra decimal place in a discount factor.
A defined-contribution arrangement shifts the work toward contributions, member outcomes, investment options and design; it does not require the same employer benefit-liability projection as a DB promise.
Routine versus project
Regular valuations and annual accounting work recur. A plan merger, benefit redesign, annuity transaction or asset strategy review is a project. Ask which valuation purposes and jurisdictions the role covers.
Reading sources
ActNet editorial guide · October 1, 2026 · Original illustrative examples.