To emerge successfully from this period of uncertainty, wealthy individuals and family business owners must look ahead to predict what the future Pension Funds landscape looks like.
There are a range of issues that pension trustees, employers and their advisers are facing as a result of COVID-19 and its economic impact, but the key focus areas are:
In the preparation and audit of the annual report and accounts of pension schemes, particular focus will need to be given to disclosure of any material uncertainties regarding going concern of the pension scheme. The pension scheme auditor will expect the trustees to provide their own assessment of going concern which takes into account the ability of the sponsoring employer to continue to support the scheme.
Pension scheme annual report and accounts preparers will also need to consider events occurring after the year end which might need additional disclosure, such as investment volatility and any agreement with the sponsoring employer to defer deficit funding contributions. Certain investment valuations may be more difficult to determine, for example property valuations are likely to come with caveats, as there is generally less certainty to the valuation of properties than would normally be the case.
COVID-19 related webinars
Sign up for our short, succinct webinars on relevant areas related to managing the impact of coronavirus.Andrew Penketh, Partner and Head of Pension Funds at Crowe, said
"Crowe is leading the way on some of these key challenges. I was delighted to chair a working group bringing together ICAEW, ICAS and PRAG, which saw these three bodies collaborate for the first time in producing guidance for pension scheme accounts preparers and auditors dealing with the challenges brought about by the COVID-19 pandemic.
"Our National Head of Forensic Services, Jim Gee, is chairing working parties at PASA and PRAG who are developing new standards to help pensions administrators and pension schemes protect themselves against the recent surges in fraud and cybercrime.
"Later this year Crowe will be publishing its annual research into pension scheme governance and risk management in anticipation of new codes of practice to be published by the Pensions Regulator. This research will provide further valuable insight into best practice as pension schemes to continue to adjust to new challenges."
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