Teilwert Parameters - ProVal 311

For tax / funding assumptions, the Teilwert Parameters topic allows you to specify parameters necessary to calculate Teilwert liability.

The Date of funding is the date at which the plan sponsor intends to begin the Teilwert calculation for the member and is used by ProVal in calculating the Teilwert funding age. ProVal first determines the Teilwert funding age as the record’s rounded age (aka “nearest age”) on the valuation anniversary date immediately preceding the funding date. In Pension or Deferred Compensation promises, if Apply German statutory rules (incl. minimum funding age) is checked, the German statutory minimum age will be applied. The statutory minimum funding age for tax/funding is based on the promise date specified in the Benefit Promise. If the promise date is prior to 2001, age 30 is the minimum age. If the promise date is after 2000 but before 2009, age 28 is the minimum age. If the promise date is in 2009 or later, age 27 is the minimum age. When ProVal is modified to calculate commercial balance sheet values based on a modified Teilwert, those calculations will reflect a minimum age of 20.

The Teilwert funding age will also be used to determine the first funding age for an entry age normal liability method (if selected under the Additional Liabilities topic).

If Apply German statutory rules (incl. minimum funding age) is checked, German-specific rules will apply to the Teilwert calculation. Uncheck the box to calculate liabilities in Austria where some of the German rules do not apply. The rules that are turned on and off with this box are:

Minimum funding age of 27, 28, or 30 (see Date of funding above)
When subtracting the Transfer Value from the PVBe, the difference is limited to no less than zero in German rules.
The Gap and Tax Reserve will not be calculated.
Jubilee promises (several differences - see Technical Reference article linked below)

For more details on the Teilwert calculation, see the Technical Reference article German Teilwert and PSVaG liability calculations.

Check the Perform Gap calculation and calculate Tax Reserve based on box to access parameters that allow you to perform current year Gap calculations based on prior year status (consistent with the Census Specifications used in the valuation), prior year Teilwert and the prior year Gap values. The Tax Reserve is then calculated as the Teilwert minus the current year Gap. For Prior year Teilwert, select the numeric database field that contains the Teilwert value at the prior valuation date; for Prior year Gap, select the numeric database field that contains the Gap value at the prior valuation date. For Prior year status, select the coded database field that contains the code identifying the participant's status in the prior year. Once the coded field is selected, the label of each field code value will appear in the Field Label column: select the appropriate ProVal Status to map it to.