· As, per Wikipedia - Actuarial science is the discipline that applies mathematical and statistical methods to assess risk in insurance, finance and other industries and professions. Actuaries are professionals trained in this discipline. In many countries, actuaries must demonstrate their competence by passing a series of rigorous professional examinations. Actuarial science includes a number of interrelated subjects, including mathematics, probability theory, statistics, and finance, economics, and computer science. Historically, actuarial science used deterministic models in the construction of tables and premiums. The science has gone through revolutionary changes since the 1980s due to the proliferation of high speed computers and the union of stochastic actuarial models with modern financial theory. · What is an Actuarial Valuation? As, per Investopedia - Actuarial valuation is a type of appraisal of a pension fund's assets versus liabilities, usi
It calls for long-term strategic planning and research to decide whether to fund gratuity liabilities. There are sundry issues that need to be taken into account. Here’s a rundown of 4 key “generic” issues, which actuarial companies in India believe are relevant to most companies as they contemplate funding their gratuity schemes. 1. Tax Benefits When an employer funds its gratuity scheme, it can get the following three benefits. · An amount equal to 8.33 percent of the sum total of all basic salaries paid by the company into its gratuity fund will be considered as a tax-deductible expense. · In case, the company is funding its gratuity liabilities for the first time, a dispensation amounting to 8.33 percent can be paid into the gratuity fund in the form of tax-deductible outlay for all the past years of an employee’s service. · The income earned as an interest or through an investment within the gratuity fund is exempted from any tax ded