Life annuities of compulsory savings and income adequacy of the elderly in Singapore

2003 ◽  
Vol 2 (1) ◽  
pp. 41-65 ◽  
Author(s):  
NGEE CHOON CHIA ◽  
ALBERT K. C. TSUI
Keyword(s):  
The Elderly ◽  
Cash Flows ◽  
Medical Expense ◽  
Income Adequacy ◽  
The Future ◽  
Single Premium ◽  
Future Consumption ◽  
Life Annuities ◽  
Deferred Annuity ◽  
Future Cash Flows

Singapore has a publicly managed central provident fund (CPF) system, which is compulsory and based on individual accounts with an explicit link between contribution and benefits. This paper assesses the adequacy of the CPF saving to meet the retirement needs of the elderly in Singapore. Instead of emphasizing the mechanism of accumulation, we focus on the expenditure side of the lifetime budget of the elderly and estimate the present value of retirement consumption (PVRC). The estimated PVRC is obtained by simulations through three major components: calibration of subsistence and medical expenses of the elderly; forecast of cohort survival probability by age and by sex; and generation of yield curves to discount the future cash flows. Our results indicate that the existing CPF-decreed minimum sum is inadequate to meet the future consumption needs of the female elderly. The inadequacy becomes more severe when medical expense is set at higher growth rates. Moreover, the monthly payouts of a single premium deferred annuity are computed as illustrative examples.

A theoretical analysis of the matching of assets to liabilities

1984 ◽  
Vol 111 (2) ◽  
pp. 375-402 ◽  
Author(s):  
A. J. Wise
Keyword(s):  
Theoretical Analysis ◽  
Mathematical Analysis ◽  
Cash Flows ◽  
Insurance Contract ◽  
Pension Scheme ◽  
The Future ◽  
The Subject ◽  
The Given ◽  
Future Cash Flows

1.1. This paper is supplementary to another by the same author on the subject of matching. It describes the mathematical analysis of the following problem.1.2. We are given:1. a pattern of expected future cash flows under a pension scheme or insurance contract;2. a set of investments available for purchase; and3. a model of the future behaviour of investment conditions.What set or sets of available investments would provide the best match against the given liabilities in order to minimize any likely surplus or deficiency on completion of the liability cash flows?

Does Foreign Investor Consider the Future Cash-flows when Investment?

2020 ◽  
Vol 20 (2) ◽  
pp. 43-64
Author(s):  
Bahlgeun Roh ◽  
Myeongjeon Oh ◽  
Jaehong Lee
Keyword(s):  
Cash Flows ◽  
Foreign Investor ◽  
The Future ◽  
Future Cash Flows

scholarly journals Prediksi Arus Kas Masa Depan Melalui Persistensi Laba Dan Komponen Akrual

2018 ◽  
Vol 3 (1) ◽  
pp. 49
Author(s):  
Muhamad Safiq ◽  
Andi Ina Yustina ◽  
Karinna Firdiastella
Keyword(s):  
Hypothesis Testing ◽  
Stock Exchange ◽  
Cash Flows ◽  
Analysis Tool ◽  
Manufacturing Companies ◽  
The Future ◽  
Alternative Test ◽  
Future Cash Flows

<p>This study aims to develop the beliefs and components of accruals related to the components that<br />exist, at the same time in the Indonesia Stock Exchange (BEI). The data used in this research is panel<br />data, from 2011 until 2015 with the number of companies as much as 58 manufacturing companies,<br />totality of data in this industry as much as 290 data. Hypothesis testing in this research using OLS<br />approach with analysis tool. Eviews 9. As for, the results of this study indicate that the persistence of<br />positive spiders on the future, but the relevant accrual components that arise during this time. .<br />Meanwhile, simultaneous does not reflect future cash futures. An alternative test resulted in a positive<br />relationship to future cash flows, where responsibility would not happen to the future. Here,<br />diseminahkan, donated by positive to the future.</p>

scholarly journals Stock Valuation: Dividend Discount Models

2011 ◽  
Author(s):  
Syrgak Kydyraliev ◽  
Anarkül Urdaletova
Keyword(s):  
Stock Price ◽  
Supply And Demand ◽  
Cash Flows ◽  
Securities Market ◽  
Present Value ◽  
Stock Valuation ◽  
Stock Value ◽  
The Future ◽  
Definition Of ◽  
Future Cash Flows

One of the most widespread problems on a securities market is the problem of definition of an estimated stock value. It is necessary to note, that the stock price as well as the price of any good in the market is defined as the result of supply and demand interaction. Our task is to offer the mechanism, which allows making decision on purchase or sale. For this purpose the method of asset estimation by future cash flows will be used – i.e. we believe that the estimated value of an asset is equal to present value of the future cash flows which are provided by the asset. In our paper we will introduce methods for the valuation of stocks with arithmetic and pseudo-arithmetic growth of dividends.

scholarly journals Una alternativa multicriterio a la valoración de empresas: aplicación a las Cajas de Ahorro

2020 ◽  
Vol 29 (1) ◽  
pp. 393
Author(s):  
Jerónimo Aznar Bellver ◽  
Roberto Cervelló Royo ◽  
Fernando García García
Keyword(s):  
Financial Institutions ◽  
Cash Flows ◽  
Comparative Methods ◽  
Current Situation ◽  
International Standards ◽  
Savings Bank ◽  
The Future ◽  
Market Approach ◽  
Future Cash Flows ◽  
Multicriteria Methodology

In several occasions the traditional valuation methodologies present difficulties in their application to the companies’ valuation, either due to valuator’s lack of enough data to use in the traditional comparative methods, or due to the difficulty when estimating the future cash-flows with objectivity. In this situation, the present study suggests an alternative which combines the CRITIC multicriteria methodology with the Valuation Ratio of the International Standards of Valuation. The new methodology is included in the comparative or market approach methods and it only requires having at its disposal a small number of comparable companies. In this work this methodology is applied to get the value of a savings bank. The valuation of this kind of financial institutions, due to the current situation of the sector, implies a task of great interest and it also constitutes a very illustrative example to show the strengths of the proposed methodology.

Why Do Firms Write Off Their Goodwill? A Comparison of Different Accounting Systems

2015 ◽  
pp. 23-40 ◽  
Author(s):  
Francesco Avallone ◽  
Claudia Gabbioneta ◽  
Paola Ramassa ◽  
Marco Sorrentino
Keyword(s):  
Good Deal ◽  
Financial Statements ◽  
Cash Flows ◽  
Accounting System ◽  
Anglo Saxon ◽  
Accounting Systems ◽  
Ifrs Adoption ◽  
The Future

Increased comparability of financial statements across adopting countries is one of the main objectives of IFRS adoption. The level of achievement of this objective, however, is still debatable. While some studies have documented that crosscountry comparability of financial statements has increased after IFRS adoption, other studies have found that comparability has actually decreased since 2005. We contribute to this debate by studying whether the motivations for goodwill writeoff are the same or vary across countries with different accounting systems. Although a good deal of research has investigated the motivations for goodwill writeoff, our study is the first to analyze whether these motivations vary across countries with different accounting systems. We find that firms that expect low cash flows in the future are more likely to report goodwill write-offs if they are located in countries with an Anglo-Saxon accounting system than if they are located in countries with a Continental accounting system. These results suggest that IFRS are "interpreted" differently in different countries and that harmonization of financial statements has not been fully achieved yet.

Does the Mandatory Adoption of IFRS Improve the Association between Accruals and Cash Flows? Evidence from Accounting Estimates

2018 ◽  
Vol 33 (1) ◽  
pp. 39-59
Author(s):  
Jimmy F. Downes ◽  
Tony Kang ◽  
Sohyung Kim ◽  
Cheol Lee
Keyword(s):  
Financial Reporting ◽  
Cash Flows ◽  
Data Availability ◽  
The European Union ◽  
Accounting Quality ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Accounting Estimates ◽  
Accounting Accruals ◽  
Future Cash Flows

SYNOPSIS We investigate the effect of mandatory International Financial Reporting Standards (IFRS) adoption in the European Union on the association between accounting estimates and future cash flows, a key concept of accounting quality within the International Accounting Standard Board conceptual framework. We find that the predictive value of accounting estimates improves after IFRS adoption. This improvement is largely driven by specific types of accounting estimates, such as accounts receivable, depreciation, and amortization expense. We also find that the improvement is concentrated in countries with larger differences between pre-IFRS domestic GAAP and IFRS. Our findings suggest that IFRS allow managers to exercise their judgment to provide information about future cash flows through the more subjective/judgmental portion of accounting accruals. JEL Classifications: M16; M49; O52. Data Availability: The data used in this study are from public sources identified in the study.

Discretionary Risk Disclosures

2003 ◽  
Vol 78 (2) ◽  
pp. 449-469 ◽  
Author(s):  
Bjorn N. Jorgensen ◽  
Michael T. Kirschenheiter
Keyword(s):  
Stock Returns ◽  
Risk Premium ◽  
Voluntary Disclosure ◽  
Cash Flows ◽  
Share Price ◽  
Risk Disclosure ◽  
Share Prices ◽  
Ex Post ◽  
Partial Disclosure ◽  
Future Cash Flows

We model managers' equilibrium strategies for voluntarily disclosing information about their firm's risk. We consider a multifirm setting in which the variance of each firm's future cash flow is uncertain. A manager can disclose, at a cost, this variance before offering the firm for sale in a competitive stock market with risk-averse investors. In our partial disclosure equilibrium, managers voluntarily disclose if their firm has a low variance of future cash flows, but withhold the information if their firm has highly variable future cash flows. We establish how the manager's discretionary risk disclosure affects the firm's share price, expected stock returns, and beta, within the framework of the Capital Asset Pricing Model. We show that whereas one manager's discretionary disclosure of his firm's risk does not affect other firms' share prices, it does affect the other firms' betas. Also, we demonstrate that a disclosing firm has lower risk premium and beta ex post than a nondisclosing firm. Finally, we show that ex ante, the expected risk premium and expected beta of each firm are higher under a mandatory risk disclosure regime than in the partial disclosure equilibrium that arises under a voluntary disclosure regime.

scholarly journals Mandatory annuitization and money's worth: evidence from Singapore

2021 ◽  
pp. 1-20
Author(s):  
Joelle H. Fong ◽  
Jackie Li
Keyword(s):  
Expected Value ◽  
Longevity Risk ◽  
Future Trends ◽  
The Past ◽  
The Future ◽  
Population Mortality ◽  
Mortality Improvement ◽  
Life Annuities ◽  
Compulsory Purchase ◽  
The Impact

Abstract This paper examines the impact of uncertainties in the future trends of mortality on annuity values in Singapore's compulsory purchase market. We document persistent population mortality improvement trends over the past few decades, which underscores the importance of longevity risk in this market. Using the money's worth framework, we find that the life annuities delivered expected payouts valued at 1.019–1.185 (0.973–1.170) per dollar of annuity premium for males (females). Even in a low mortality improvement scenario, the annuities provide an expected value exceeding 0.950. This suggests that participants in the national annuity pool have access to attractively priced annuities, regardless of sex, product, and premium invested.

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