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Is there a right way to measure the time value of money?

  • PSAS - CPA Canada Image

Nov 09, 2017

On November 9, 2017, CPA Canada released an article on how the choice of discount rate could have significant effects on the benefit obligation reported.

Employment benefit obligations are often incurred years before benefit payments are due. Many would agree that the benefit obligation reported in the financial statements should reflect the present value of the estimated future benefit payments at the reporting date. However, there is widespread disagreement about which discount rate would best reflect the time value of money in determining the benefit obligation.

Read this article to learn about the debate on which discount rate would best reflect the time value of money in determining the benefit obligation.

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