The Custom Regulatory Tables Library allows you to reference certain types of data that change annually but that ProVal and ProAdmin do not automatically attempt to “manage” because they are not needed for any built-in operators. This feature is most often useful for creating special compensation limits, especially for limiting each year’s salary in a final average salary determination. It is useful also for referencing wage bases other than the U.S. social security wage base, for example, a Railroad Retirement Board wage base, if you need to use both sets of wage bases within the same Valuation or Core Projection. Furthermore, alternative rounding options are available for salary limits and wage bases specified in custom regulatory tables (alternatives that are not available for the maximum compensation and social security wage base values specified by means of the Regulatory Data topic of the Valuation Assumptions command, including values in the default regulatory data text files).

Thus, for example, if you have a plan that limits salaries by $50,000, increasing periodically, then you can create a text (.txt) file that holds the two columns of information: the plan year and the compensation limit for that year. You can then identify this file for ProVal or ProAdmin as a “custom regulatory table” of a “compensation limit type”. Once this library entry has been created, it will be available to be accessed in Salary and Final Average Salary custom operators for limiting salary, and also, in ProVal, as the compensation limit for the determination of valuation salary and present value of future salary. You create and identify a text file as a “custom regulatory table” of a “wage base type” in similar fashion and access it in a Covered Compensation custom operator for limiting a wage base or other ”breakpoint” or “integration level”.

The values in the table will be used for all years prior to and including the Valuation Date and increase rates must be specified in the Valuation Assumptions (in a forecast, for Projection Assumptions as well) so that ProVal can produce values to be used for years after the Valuation Date. For more information about the methodology used for tables identified as wage bases, see the Technical Reference article entitled U.S. social security wage base.

The following information comprises the definition of a Custom Regulatory Table library entry:

Name may be any descriptive phrase, including spaces, under which to save this Custom Regulatory Table.

Custom Regulatory Text File allows you to select a text (.txt) file that holds the custom regulatory data. The referenced file must contain two columns of data: the year and the regulatory limit associated with that year. The data must be complete; that is, blank values are not permitted for any year included in the text file. If values are needed for years prior to the earliest year in the text file (for example, for an entry age normal calculation for a plan participant who entered the plan in 1970 if the table starts at 1990), ProVal will use the value entered for the oldest specified year for all earlier years (in our example, ProVal will use the 1990 value for years 1970 through 1989).

Type indicates whether the table is to be treated as a Compensation limit or a Wage base. This choice will control where the table will be accessible in ProVal and ProAdmin. Specifically, compensation limit tables will be available to limit salaries anywhere that a compensation limit might be applicable, including salary and final average salary custom operators (and salary limits in present value of future salaries and valuation salary calculations), whereas wage base tables will be available anywhere that a wage base might be applicable, including the covered compensation custom operator (and salary limits in custom operators).

Rounding allows you to control rounding of both the specified table values and the future values projected in accordance with the increase rates specified in the Valuation Assumptions and, in a forecast, for Projection Assumptions.

• If you choose None, no rounding will be applied to either the specified or projected values.

• If you choose Apply U.S. maximum compensation rounding, the rounding applicable to the U.S. Internal Revenue Code section 410(a)(17) maximum compensation limit will be applied to the specified and projected table values. This allows you to create, for example, a table that is comparable to RegMaxComp.txt but in which the $150,000 limit is applied retroactively. Typically, U.S. maximum compensation limits for years after 2002 are rounded down to the nearest multiple of $5,000 (after projection from the 2002 published limit value of $200,000). For years before 1995, no rounding is applied, and a $10,000 multiple is used for years from 1995 through 2001. If the provisions of the Economic Growth and Tax Relief Act of 2001, commonly known as EGTRRA, are not applied (i.e., the Apply 2001 Tax Act actuarial equivalence and rounding provisions box, found under the Regulatory Data topic of Valuation Assumptions, is not checked), the limits for years after 1994 are rounded down to the nearest multiple of $10,000 except for the 2002 limit, which was not obtained by projection but was “reset” as $200,000.

• If you choose Apply rounding rule, you can indicate the desired degree of rounding, by specifying the Amount, and the rounding Direction, which indicates whether values should be rounded up, down or to the nearest multiple of the rounding rule Amount. A value of 100 entered as the Amount, for example, indicates that values should be rounded to hundreds, whereas a value of 0.01 indicates that values should be rounded to hundredths and a value of 0.001 indicates that values should be rounded to thousandths. The rounding direction options are “Nearest”, “Up” or “Down”. If you enter an Amount of 1 and select the “Nearest” option for the Direction, then the specified and projected table values will be rounded to the nearest dollar. Similarly, if you enter 100 for the Amount and select “Up”, then those values will be rounded up to the next multiple of $100. Note that the selected rounding rule applies to all years, that is, to historical custom table values up to and including the year of the valuation date, as well as to the projected values of years after the valuation date.