Qualified Longevity Annuity Contract and Qualitative characteristics of useful financial information: Difference between pages

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imported>Doug Williamson
(Create page. Sources: linked pages, US Treasury webpage https://www.treasury.gov/press-center/press-releases/Pages/jl2448.aspx and Immediate annuities webpage https://www.immediateannuities.com/qlac-qualified-longevity-annuity-contract/)
 
imported>Doug Williamson
(Create page - source - IAS Plus - https://www.iasplus.com/en/standards/other/framework)
 
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''Pensions - defined contribution - US.''
''Financial reporting - International Financial Reporting Standards (IFRS) - Conceptual Framework for Financial Reporting (Conceptual framework) - International Accounting Standards Board (IASB).''


(QLAC).
The financial reporting Conceptual framework identifies the fundamental qualitative characteristics of useful financial information as:


Longevity annuities are designed to deal with the US pensions problem of retired people 'outliving their savings' caused by the US Required Minimum Distributions rules.
*Relevance, and


Longevity annuities do not start paying out until later in life, so they can pay out higher annual amounts in those later years, while still enjoying favourable tax treatment.
*Faithful representation.




'Qualified' refers to the compliance with the tax rules, so as to enjoy favourable tax treatment.
The Conceptual framework goes on to identify the following further characteristics as enhancing the usefulness of relevant and faithfully represented financial information:


A qualified longevity annuity contract is exempted from the US Required Minimum Distributions (minimum withdrawal) rules.
*Comparability
*Verifiability
*Timeliness, and
*Understandability.


So that more of the total retirement fund can be retained to support income in the later years of life.
Longevity annuities are contrasted with immediate annuities, which start to pay out immediately.


== See also ==
* [[Accounting concepts]]
* [[Comparability]]
* [[Conceptual framework]]
* [[Faithful representation]]
* [[Financial reporting]]
* [[International Accounting Standards]]
* [[International Accounting Standards Board]]  (IASB)
* [[International Financial Reporting Standards]]  (IFRS)
* [[Neutrality]]
* [[Prudence]]
* [[Qualitative techniques]]
* [[Relevance]]
* [[Stewardship]]
* [[Substance over form]]
* [[Timeliness]]
* [[True and fair view]]
* [[Understandability]]
* [[Useful financial information]]
* [[Verifiability]]


== See also ==
* [[401(k) plan]]
* [[Annuity]]
* [[Contributions]]
* [[Defined contribution pension scheme]]
* [[Internal Revenue Service]]
* [[Occupational pension scheme]]
* [[Required Minimum Distribution]]
* [[Stakeholder pension scheme]]
* [[United States]]


[[Category:Accounting,_tax_and_regulation]]
== External links ==
[[Category:The_business_context]]
*[https://www.iasplus.com/en/standards/other/framework Conceptual framework for financial reporting - IAS Plus]
[[Category:Financial_products_and_markets]]
*[[Media:IFRS_conceptual-framework-project-summary.pdf|IFRS Conceptual Framework Project Summary 2018]]

Revision as of 10:49, 4 March 2022

Financial reporting - International Financial Reporting Standards (IFRS) - Conceptual Framework for Financial Reporting (Conceptual framework) - International Accounting Standards Board (IASB).

The financial reporting Conceptual framework identifies the fundamental qualitative characteristics of useful financial information as:

  • Relevance, and
  • Faithful representation.


The Conceptual framework goes on to identify the following further characteristics as enhancing the usefulness of relevant and faithfully represented financial information:

  • Comparability
  • Verifiability
  • Timeliness, and
  • Understandability.


See also


External links

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