Written answers
Tuesday, 26 June 2007
Department of Finance
Pension Provisions
10:00 pm
Michael D'Arcy (Wexford, Fine Gael)
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Question 85: To ask the Tánaiste and Minister for Finance if his attention has been drawn to the fact that in some Departments instructions have issued to agencies under their supervision that they should not follow general accounting principles in presenting deferred pension liabilities; and if he will make a statement on the matter. [17289/07]
Brian Cowen (Laois-Offaly, Fianna Fail)
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I assume that the Deputy is referring to the application of Financial Reporting Standard 17 — known as FRS 17 — that requires annual accounts to show the total accrued value of future pension liabilities in respect of staff. FRS 17 is applied through-out the private sector and in the accounts of all commercial State bodies.
In the public service, FRS 17 does not arise in the case of accounts prepared on a cash-basis. This includes the Appropriation Accounts for all Departments and Offices covering most of central government. However, FRS 17 does apply to non-commercial State bodies whose financial statements are prepared on the basis of accruals accounting. Normally these accounts would show pension liabilities — for example, where there are funded pension schemes. In relation to pay-as-you-go pensions, with the agreement of the Comptroller and Auditor General, most of these accounts now show an asset to balance the pensions liability. This reflects the fact that public service pension funding policy provides financing for pay-as-you-go pensions.
Ministers have statutory powers to determine the form of accounts of bodies under the aegis of their Departments. Any specific questions in relation to particular accounts should be addressed to the relevant Minister.
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