Instructions For Schedule B (Form 5500) - Actuarial Information

employer has made an election under Code section

special rule for nonrecurring circumstances is used, and label

412(l)(7)(D)(iv).

the certification “Schedule B, line 4b – Liquidity

Requirement Certification” (see Code section

Line 2a. Current Value of Assets. Enter the current value of

412(m)(5)(E)(ii)(II) and Q&A-13 of Rev. Rul. 95-31).

net assets as of the first day of the plan year. Except for plans

with excluded assets as described above, this entry should be

If the plan has a liquidity shortfall for any quarter of the plan

the same as reported on the 2006 Schedule H (Form 5500)

year (see Q&A-10 of Rev. Rul. 95-31), enter the amount of the

(line 1l, column (a)) or Schedule I (Form 5500) (line 1c, column

liquidity shortfall for each such quarter. If the plan was subject

(a)), or, alternatively, the 2006 Form 5500-EZ (line 11a, column

to the liquidity requirement, but did not have a liquidity shortfall,

(a): total assets at the beginning of the year). Note that

enter zero. File Form 5330, Return of Excise Taxes Related to

contributions designated for the 2006 plan year are not included

Employee Benefit Plans, with the IRS to pay the 10% excise

on those lines.

tax(es) if there is a failure to pay the liquidity shortfall by the

required due date, unless a waiver of the 10% tax under Code

Line 2b. “RPA ’94” Current Liability (beginning of plan

section 4971(f) has been granted.

year). Enter the “RPA ’94” current liability as of the first day of

the plan year. Do not include the expected increase in current

Line 5. Actuarial Cost Method. Enter only the primary method

liability due to benefits accruing during the plan year. See the

used. If the plan uses one actuarial cost method in one year as

instructions for line 1d(2)(a) for actuarial assumptions used in

the basis of establishing an accrued liability for use under the

determining “RPA ’94” current liability.

frozen initial liability method in subsequent years, answer as if

the frozen initial liability method was used in all years. The

Column (1) — Enter the number of participants and

projected unit credit method is included in the “Accrued benefit

beneficiaries as of the beginning of the plan year. If the current

(unit credit)” category of line 5c. If a method other than a

liability figures are derived from a valuation that follows the first

method listed in lines 5a through 5g is used, check the box for

day of the plan year, the participant and beneficiary count

line 5h and specify the method. For example, if a modified

entries should be derived from the counts used in that valuation

individual level premium method for which actuarial gains and

in a manner consistent with the derivation of the current liability

losses are spread as a part of future normal cost is used, check

reported in columns (2) and (3).

the box for 5h and describe the cost method. For the shortfall

Column (2) — Include only the portion of the current liability

method, check the appropriate box for the underlying actuarial

attributable to vested benefits.

cost method used to determine the annual computation charge.

Column (3) — Include the current liability attributable to all

Changes in funding methods include changes in actuarial

benefits, both vested and nonvested.

cost method, changes in asset valuation method, and changes

Line 2c. This calculation is required under ERISA section

in the valuation date of plan costs and liabilities or of plan

103(d)(11). Do not complete if line 2a divided by line 2b(4),

assets. Changes in the funding method of a plan include not

column (3), is 70% or greater.

only changes to the overall funding method used by the plan,

Line 3. Contributions Made to Plan. Show all employer and

but also changes to each specific method of computation used

employee contributions for the plan year. Include employer

in applying the overall method. Generally, these changes

contributions made not later than 2

months (or the later date

require IRS approval. If the change was made pursuant to Rev.

allowed under Code section 412(c)(10) and ERISA section

Proc. 2000-40, 2000-2 C.B. 357, check “Yes” in line 5j. If

302(c)(10)) after the end of the plan year. Show only

approval was granted by either an individual ruling letter or a

contributions actually made to the plan by the date Schedule B

class ruling letter for this plan, enter the date of the applicable

is signed. Certain employer contributions must be made in

ruling letter in line 5k. Note that the plan sponsor’s agreement

quarterly installments. See Code section 412(m). Note that

to a change in funding method (made pursuant to Rev. Proc.

contributions made to meet the liquidity requirement of Code

2000-40 or a class ruling letter) should be reported on line 7 of

section 412(m)(5) should be reported.

Schedule R (Form 5500).

Add the amounts in both columns (b) and (c) and enter both

Line 6. Actuarial Assumptions. If gender-based assumptions

results on the total line. All contributions must be credited

are used in developing plan costs, enter those rates where

toward a particular plan year.

appropriate in line 6. Note that requests for gender-based cost

information do not suggest that gender-based benefits are

Line 4a. Quarterly Contributions. In accordance with “RPA

legal. If unisex tables are used, enter the values in both “Male”

’94,” only plans that have a funded current liability percentage

and “Female” lines. Complete all blanks. Check “N/A” if not

(as provided in Rev. Rul. 95-31, 1995-1 C.B. 76) for the

applicable.

preceding plan year of less than 100 percent are subject to the

quarterly contribution requirement of Code section 412(m) and

Attach a statement of actuarial assumptions (if not fully

ERISA section 302(e). For 2006, the funded current liability

described by line 6) and actuarial methods used to calculate the

percentage for the preceding plan year is equal to line 1b(2)

figures shown in lines 1 and 9 (if not fully described by line 5),

(actuarial value of assets) divided by line 1d(2)(a) (“RPA ’94”

and label the statement “Schedule B, line 6 – Statement of

current liability), both lines as reported on the 2005 Schedule B

Actuarial Assumptions/Methods.” The statement must

(Q&A-3, 4, and 5 of Rev. Rul. 95-31, also provide guidance on

describe all actuarial assumptions used to determine the

this computation). If line 1d(2)(a) is zero for 2005 or if box B(1)

liabilities. For example, the statement for non-traditional plans

of Part I of Form 5500 is checked, enter 100%.

(e.g., cash balance plans) must include the assumptions used

Note. Section 101(d)(2) of the Pension Funding Equity Act of

to convert balances to annuities.

2004 provided a lookback rule for the purpose of applying

Also attach a summary of the principal eligibility and benefit

section 412(m)(1) of the Internal Revenue Code of 1986, for

provisions on which the valuation was based, including the

plan years beginning after December 31, 2003. If this lookback

status of the plan (e.g., eligibility frozen, service/pay frozen,

rule is used, attach a demonstration of the use of this lookback

benefits frozen), optional forms of benefits, special plan

rule to the Schedule B and label the attachment “Schedule B,

provisions, including those that apply only to a subgroup of

line 4a – 412(m)(1) Lookback Rule.”

employees (e.g., those with imputed service), supplemental

Line 4b. Multiemployer plans, plans with funded current liability

benefits, an identification of benefits not included in the

percentages (as provided in Code section 412(m)(1)) of 100

valuation (e.g., shutdown benefits), a description of any

percent or more for the preceding plan year, and plans that on

significant events that occurred during the year, a summary of

every day of the preceding plan year had 100 or fewer

any changes in principal eligibility or benefit provisions since the

participants (as defined under the Who Must File discussion for

last valuation, a description (or reasonably representative

Schedule B) are not subject to the liquidity requirement of Code

sample) of plan early retirement factors, and any change in

section 412(m)(5) and ERISA section 302(e)(5) and should not

actuarial assumptions or cost methods and justifications for any

complete this line. See Q&As 7 through 17 of Rev. Rul. 95-31

such change (see section 103(d) of ERISA), and label the

for guidance on the liquidity requirement. Note that a

summary “Schedule B, line 6 – Summary of Plan

certification by the enrolled actuary must be attached if the

Provisions.”

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Instructions For Schedule B (Form 5500) - Actuarial Information - 2006 Page 5

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