Actuarial accrued liability
The present value of projected future benefits earned by employees to date.
Actuarial assumptions
Factors that must be assumed for purposes of projecting future benefit payments as part of an actuarial valuation.
Actuarial valuation
A process used by actuaries to 1) project future benefit payments, 2) discount those payments to their total present value, and 3) systematically allocate an appropriate portion of that amount to each period of employee service using one of several accepted methods.
Advance funding
A method of financing benefits by placing resources in trust as employees earn benefits so that the resources thus accumulated, along with related earnings, can be used to make benefit payments as they become due.
Agent multiple-employer plan
A centralized organization, such as a statewide public-employee retirement system, that manages the individual plans of a number of different employers. An agent multiple-employer plan will have a separate actuarial valuation and separate rates for each participating employer.
Annual required contribution
The portion of the present value of projected benefits earned by employees attributable to the current period.
Contribution
Payment to a third party, including a trust or equivalent arrangement, in connection with post-employment benefits.
Implicit rate subsidy
The de facto subsidy of retirees by permitting them to pay lower than age-adjusted premiums through the use of a single-common or blended premium for both retirees and active employees.
Net OPEB obligation
Accounting liability created when an employer does not fully fund its annual required contribution for OPEB.
Other post-employment benefits
All types of post-employment benefits not offered as an integral part of a pension plan, as well as all forms of post-employment healthcare.
Pay-as-you-go funding
A method of financing benefits by making required payments only as they come due.
Substantive plan
The term of an OPEB arrangement as understood by both employer and employees.
Unfunded actuarial accrued liability
The difference between the actuarial accrued liability and the actuarial value of assets accumulated to finance that obligation.