Study on the discount rate applied to retirement benefit obligation focusing on domestic listed companies in Korea - Suggestion of the proper growth rate of liabilities and the adequacy of bonds and methods applied -
Lee, Soo Yong
The retirement benefit obligations of domestic listed companies have different names in different laws; the defined benefit obligation in the K-IFRS, the retirement allowances in the Corporate Tax Law and reserves on the going concern basis in the Employment Retirement Benefit Security Law. The actuarial assumptions are applied when calculating the retirement benefit obligations. The discount rate in the assumption is one of the major factors in the retirement benefit obligation decision. We used the growth rate of the retirement benefit liabilities derived from the circulation model of the defined benefit obligation as a research model. We cross-checked the application methods of the expected interest rate and the discount rate to evaluate the adequacy.
growth rate of the liabilities,Defined benefit obligation,discount rate