The Contribution Policy topic contains parameters that pertain to:

1. the actuarial cost method applied to determine

• in the U.S. qualified and Canadian registered pension modes, statutory minimum required contributions and maximum tax deductible contribution limits, except for U.S. qualified mode single-employer pension plan calculations reflecting the funding provisions of the Pension Protection Act of 2006 (PPA),

• in any mode, the employer’s contribution to the plan under an employer strategy to contribute normal cost plus supplemental cost, and

• in OPEB mode, an actuarial liability upon which a funded ratio-dependent employer contribution strategy is based;

2. the employer’s strategy, or policy, for making contributions to the plan for the current year and for future years of a forecast period;

3. relevant conditions  including

• payment of an additional contribution, beyond that indicated by the selected contribution policy,

• in the U.S. qualified and Canadian registered modes, exemption from the maximum tax deductible contribution limits,

• definition of the plan year and, in the U.S. qualified mode for plan years not subject to PPA, the tax year, and

• additional constraints upon and adjustments to the employer’s contribution policy, such as timing of the employer contribution;

4. options for contribution timing;

5. in Canadian mode, triennial valuations, adjustments to the normal cost and definition of the solvency liability amortization interest rate; and

6. in the universal mode, application of international funding rules, including country-specific rules.

Note that the specifications you make under the Contribution Policy topic have an effect on accounting expense calculations to the extent that funding contributions affect such expenses. For valuations, anticipated contributions have an impact on the expected return on plan assets. For forecasts, the actuarial cost method, coupled with the plan sponsor’s contribution policy, will affect the future value of plan assets, which, in turn, impacts accounting expense.