New Search
(2) Pension costs calculated using an actuarial cost- based method recognized by GAAP are <br />allowable for a given fiscal year if they are funded for that year within six months after the end <br />of that year. Costs funded after the six month period (or a later period agreed to by the cognizant <br />agency) are allowable in the year funded. The cognizant agency may agree to an extension of the <br />six month period if an appropriate adjustment is made to compensate for the timing of the <br />charges to the Federal Government and related Federal reimbursement and the governmental <br />unit's contribution to the pension fund. Adjustments may be made by cash refund or other <br />equitable procedures to compensate the Federal Government for the time value of Federal <br />reimbursements in excess of contributions to the pension fund. <br />(3) Amounts funded by the governmental unit in excess of the actuarially determined amount for <br />a fiscal year may be used as the governmental unit's contribution in future periods. <br />(4) When a governmental unit converts to an acceptable actuarial cost method, as defined by <br />GAAP, and funds pension costs in accordance with this method, the unfunded liability at the <br />time of conversion shall be allowable if amortized over a period of years in accordance with <br />GAAP. <br />(5) The Federal Government shall receive an equitable share of any previously allowed pension <br />costs (including earnings thereon) which revert or inure to the governmental unit in the form of a <br />refund, withdrawal, or other credit. <br />f. Post-retirement health benefits. Post-retirement health benefits (PRHB) refers to costs of <br />health insurance or health services not included in a pension plan covered by subsection e. for <br />retirees and their spouses, dependents, and survivors. PRHB costs may be computed using a <br />pay-as-you-go method or an acceptable actuarial cost method in accordance with established <br />written polices of the governmental unit. <br />(1) For PRHB financed on a pay as-you-go method, allowable costs will be limited to those <br />representing actual payments to retirees or their beneficiaries. <br />(2) PRHB costs calculated using an actuarial cost method recognized by GAAP are allowable if <br />they are funded for that year within six months after the end of that year. Costs funded after the <br />six month period (or a later period agreed to by the cognizant agency) are allowable in the year <br />funded. The cognizant agency may agree to an extension of the six month period if an <br />appropriate adjustment is made to compensate for the timing of the charges to the Federal <br />Government and related Federal reimbursements and the governmental unit's contributions to the <br />PRHB fund. Adjustments may be made by cash refund, reduction in current year's PRHB costs, <br />or other equitable procedures to compensate the Federal Government for the time value of <br />Federal reimbursements in excess of contributions to the PRHB fund. <br />(3) Amounts funded in excess of the actuarially determined amount for a fiscal year may be used <br />as the government's contribution in a future period. <br />(4) When a governmental unit converts to an acceptable actuarial cost method and funds PRHB <br />costs in accordance with this method, the initial unfunded liability attributable to prior years <br />19 <br /> <br />