department of defense agency financial report fiscal year 2012

More documents

Recommendations

Info

Department of Defense Agency Financial Report for FY 2012 Other Federal Employment Benefits Actuarial Cost Method Used: Aggregate Entry-Age Method Assumptions: Effective Interest Market Value of Investments in Market-based and Marketable Securities: $662.4 billion Military Retirement and Other Federal Employment Benefits Dollars in Millions As of September 30 Military Retirement Pensions Military Pre- Medicare Eligible Retiree Health Benefits 2012 Military Medicare- Eligible Retiree Health Benefits Voluntary Separation Incentive Programs DoD Education Benefits Fund Beginning Actuarial Liability $ 1,360,922.5 $ 305,985.0 $ 533,667.7 $ 770.1 $ 1,773.6 Normal Cost Liability 30,563.7 10,700.7 10,958.3 0.0 299.0 Interest Cost 64,807.2 15,237.2 26,457.4 27.1 78.2 Plan Amendments 0.0 1,384.1 (33,269.9) 0.0 0.0 Experience Losses (Gains) (3,202.1) (5,611.4) (6,682.4) (14.2) (93.4) Other factors Subtotal: Expenses before 0.2 (0.0) 0.1 (0.1) (259.7) Losses (Gains) from Actuarial Assumption Changes Actuarial (Gain)/Loss due to : 92,169.0 21,710.6 (2,536.5) 12.8 24.1 Changes in trend assumptions 0.0 (23,958.5) (14,673.9) 0.0 0.0 Changes in assumptions other than trend 77,190.2 6,063.8 25,794.6 11.0 0.0 Subtotal: Losses (Gains) from Actuarial Assumption Changes 77,190.2 (17,894.7) 11,120.7 11.0 0.0 Total Expenses $ 169,359.2 $ 3,815.9 $ 8,584.2 $ 23.8 $ 24.1 Less Benefit Outlays 52,363.7 11,584,0 9,470.6 115.7 412.3 Total Changes in Actuarial Liability $ 116,995.5 $ (7,768.1) $ (886.4) $ (91.9) $ (388.2) Ending Actuarial Liability $ 1,477,918.0 $ 298,216.9 $ 532,781.3 $ 678.2 $ 1,385.4 The Department complies with SFFAS No. 33, “Pensions, Other Retirement Benefits, and Other Postemployment Benefits: Reporting the Gains and Losses from Changes in Assumptions and Selecting Discount Rates and Valuation Dates.” The standard requires the separate presentation of gains and losses from changes in long-term assumptions used to estimate liabilities associated with pensions, other retirement and postemployment benefits. The SFFAS No. 33 also provides a standard for selecting the discount rate and valuation date used in estimating these liabilities. Military Retirement Pensions The Military Retirement Fund is a defined benefit plan authorized by Public Law (PL) 98-94 to provide funds used to pay annuities and pensions to retired military personnel and their survivors. The Department of Defense (DoD) Board of Actuaries approves the long-term economic assumptions for inflation, salary, and interest. The actuaries calculate the actuarial liabilities annually using economic assumptions and actual experience (e.g., mortality and retirement rates). Due to reporting deadlines, the current year actuarial 114 Financial Information
Department of Defense Agency Financial Report for FY 2012 present value of projected plan benefits rolls forward from the prior year’s valuation results. The actuaries used the following assumptions to calculate the FY 2012 roll-forward amount: Military Retirement Pensions Inflation Salary Interest Fiscal Year 2012 3.6% (actual) 1.6% (actual) 4.8% Fiscal Year 2013 1.6% (estimated) 1.7% (estimated) 4.6% Long Term 2.6% 3.0% 4.6% Actuarial Cost Method Used: Aggregate Entry-Age Normal Method Market Value of Investments in Market-Based and Marketable Securities: $540.2 billion Assumed Interest Rate: 4.8 percent Historically, the initial unfunded liability of the program was amortized over a 50-year period. Effective FY 2008, the initial unfunded liability is amortized over a 42-year period to ensure the annual payments cover the interest on the unfunded actuarial liability, with the last payment expected October 1, 2025. All subsequent gains and losses experienced are amortized over a 30-year period. MILITARY RETIREMENT HEALTH BENEFITS (MRHB) The MRHB are post-retirement benefits the Department provides to non-Medicare-eligible military retirees and other eligible beneficiaries through private sector health care providers and the Department’s medical treatment facilities. The actuaries calculate the actuarial liabilities annually using assumptions and actual experience. For the FY 2012 actuarial liability calculation, the actuaries used the following assumptions: MHRB Medical Trend 115 FY 2011 – FY 2012 Ultimate Rate FY 2036 Medicare Inpatient (Direct Care) 1.60% 5.35% Medicare Outpatient (Direct Care) 2.26% 5.35% Medicare Prescriptions (Direct Care) 0.00% 5.35% Non-Medicare Inpatient (Direct Care) 2.00% 5.35% Non-Medicare Outpatient (Direct Care) 5.00% 5.35% Non-Medicare Prescriptions (Direct Care) 1.70% 5.35% Non-Medicare Inpatient (Purchased Care) 4.57% 5.35% Non-Medicare Outpatient (Purchased Care) 5.34% 5.35% Non-Medicare Prescriptions (Purchased Care) 5.25% 5.35% U.S. Family Health Plan (USFHP) (Purchased Care) Actuarial Cost Method Used: Aggregate Entry-Age Normal Method Assumed Interest Rate: 4.6 percent 4.75% 5.35% Medicare-Eligible Retiree Health Care Fund (MERHCF) Benefits In accordance with PL 106-398, MERHCF accumulates funds to finance the health care program liabilities of Medicare-eligible retirees for all the Uniformed Services and specific Medicare-eligible beneficiaries. The DoD Board of Actuaries approves the long-term assumptions for medical trends and interest. The actuaries calculate the actuarial liabilities annually using actual experience (e.g., mortality and retirement rates, direct care costs, purchased care). Due to reporting deadlines, the current year actuarial present value of projected plan benefits rolls forward from the prior year’s results. The actuaries used the Financial Information
Page 1 and 2:
DEPARTMENT OF DEFENSE AGENCY FINANC
Page 3 and 4:
Department of Defense Agency Financ
Page 6:
Page 9 and 10:
Page 11 and 12:
Page 13 and 14:
Page 15 and 16:
Page 17 and 18:
Page 19 and 20:
Page 21 and 22:
Page 23 and 24:
Page 25 and 26:
Page 27 and 28:
Page 29 and 30:
Page 31 and 32:
Page 33 and 34:
Page 35 and 36:
Page 37 and 38:
Page 39 and 40:
Page 41 and 42:
Page 43 and 44:
Page 45 and 46:
Page 47 and 48:
Page 49 and 50:
Page 51 and 52:
Page 53 and 54:
Page 55 and 56:
Page 57 and 58:
Page 59 and 60:
Page 61 and 62:
Page 63 and 64:
Page 65 and 66:
Page 67 and 68: Department of Defense Agency Financ
Page 117: Department of Defense Agency Financ
Page 159 and 160: DEPARTMENT OF DEFENSE AGENCY FINANC
Page 169 and 170:
Page 171 and 172:
Page 173 and 174:
Page 175 and 176:
Page 177 and 178:
Page 179 and 180:
Page 181 and 182:
Page 183 and 184:
Page 185 and 186:
Page 187 and 188:
Page 189 and 190:
Page 191 and 192:
Page 193 and 194:
Page 195 and 196:
Page 197 and 198:
Page 199 and 200:
Page 201 and 202:
Page 203 and 204:
Page 205 and 206:
Page 207 and 208:
Page 209 and 210:
Page 211 and 212:
Page 213 and 214:
Page 215 and 216:
Page 217 and 218:
Page 219 and 220:
Page 221 and 222:
Page 223 and 224:
Page 225 and 226:
Page 227 and 228:
Page 229 and 230:
Page 231 and 232:
Page 233 and 234:
Page 235 and 236:
Page 237 and 238:
Page 239 and 240:
Page 241 and 242:
Page 243 and 244:
Page 245 and 246:
Page 247 and 248:
Page 249 and 250:
Page 251 and 252:
Page 253 and 254:
Page 255 and 256:
Page 257 and 258:
Page 259 and 260:
Contributors to the Agency Financia
show all

department of defense agency financial report fiscal year 2012

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?