New Mortality Tables for Defined Benefit Plans

In early November 2014, the Society of Actuaries (SOA) released and recommended new mortality tables, which for the first time measures mortality on a generational basis for defined benefit pension plans. These mortality tables incorporate the key assumption that the younger generation will have a longer life expectancy.

We have not seen actual projected dollar impact at this point, but we are anticipating the new mortality tables could significantly increase a Plan Sponsor’s defined benefit pension liability. Important to note is that the IRS is not anticipated to change its mortality tables required for funding purposes until possibly 2016. This could create a disconnect between the mortality assumptions used by the Plan Sponsor for its pension funding and for its financial reporting.

Therefore, we recommend that all parties, the Plan Sponsor, actuary, and accountant, should have discussions to understand the new mortality table and its potential impact. Our Employee Benefit Plan Audit Team is available if you have any questions or concerns about this change.


Scott A. Esworthy, CPA


Scott is a Principal with BSSF, specializing in the audits of property and casualty insurance entities (P&C) and employee benefit plans. His expertise in these areas extends beyond the Central PA region. Scott and his team serve clients in the Mid-Atlantic Region, with a focus in Pennsylvania, New Jersey, Maryland, Delaware, Virginia, Ohio, and New York.