FRC publishes revised version of Actuarial Standard Technical Memorandum 1

News types: Codes and Standards Announcements, Consultation Announcement, Feedback Statement, Policies and Responsibilities

Published: 9 February 2024

The Financial Reporting Council (FRC) has today published a revised version of Actuarial Standard Technical Memorandum 1 (AS TM1).

The revised standard, effective from 6 April 2024, has higher accumulation rate assumptions in response to higher long term interest rates and gilt yields resulting in higher long term expected returns.

The FRC is responsible for maintaining and issuing Actuarial Standard Technical Memorandum 1 which specifies the assumptions and methods to be used in illustrations of money purchase/defined contribution pensions. AS TM1 provides a basis for producing defined contribution pension illustrations that are consistent between providers to help users better understand their retirement savings. The FRC annually reviews the appropriateness of the assumptions set out in AS TM1 to ensure they remain fit for purpose.

The FRC’s Executive Director of Regulatory Standards, Mark Babington said:

It is essential that pension scheme members have confidence in the consistency and reliability of their pension illustrations. The revisions announced today will enable pension illustrations to better reflect potential returns from their pension savings.