PBGC Company Profile Essay

PBGC is an contraction of a Pension Benefit Guaranty Corporation. The purpose of this federal flock is to protect Americans pension. Its mission is tie in to protection forty four gazillion American workers retirement income is newly worldness protected in more than 30000 loll rough pension plans of private single-employer and multiemployer. Its formation is the leave behind of an act of 1974 by the name Employee Retirement Income protective coering Act. It has the following objectives offset printing It helps private-sector define benefit pension plans to be continued and remain fountainhead maintained.Second is to add pension benefits payment time to time, without any interruption. Its trinity objective is to keep minimum pension policy allowances. The defined benefit pension plan portion outs pension on a monthly root to the retirees but the pension amount is depended upon the salary and the year of services the retirees relieve whizself rendered. The club d oes not only give monthly payments to retirees up to the guaranteed supreme but withal the multiemployer plans participants and peerless who have not retired yet stand by financial assistance from it. public Tax Revenues dont give any kind of fund to this corporation.Insurance premiums financed the operations of this federal corporation which was being set by Congress. Insurance premium is being salaried by the sponsors defined for each benefit plan that are fundamentally employers. The rec all overies are being do from the companies which would be responsible for the plans in the past. net come from investments for this corporation. According to the plan ended in 2008, workers will get $4,312. 50 monthly when they will get retire at the be on of 65. It serves the range of customers e. g. general public, media and so on.Board of directors including the Secretaries of elbow grease (Chair), Commerce and the Treasury guided the operations of PBGC. The two highest priorities of this administration is to crystalise the defined benefit pension carcass and bring improvement in retirement security. It contributed in the development of Pension Protection Act of 2006. Since PBGC has worked over the last 33 years for the protection plan of participants interests and also to support private pension systems harvest millions of American workers can now think about secured retirement on with their families.Both the benefit plan and the guarantee by PBGC have made a difference in the lives of the diligent Americans. Annually about $4 million is being given by this corporation to 44 million Americans. The development of the 2006 act not only improved the status of reenforcement of many defined benefit plans but also pension system is being strengthened. Competitive advantage The corporation has been very effective passim in managing change over the past few years, pension insurance course of studys have faced many unexpected challenges.The corporation also w in an award of managing its work force superbly in this changing channel environment. The executive director said We are pleased to be recognized for having the right people, processes and systems in place to manage a doubling of our customer base with no diminution in the quality of our customer service. (www. pbgc. gov,2008). It was being a first federal agency which got the full hallmark for its executive evaluation system. It got plenty of awards presented in magazines.These are as down the stairs General Excellence, Service, Competitive Advantage, Global Outlook, Innovation, Managing kind, Financial Impact, Partnership, Ethical Practice and Vision. Weaknesses of PBGC Weaknesses of PBGCs certification and accreditation (C&A) This would impact the accuracy and completion of information which would affect the credibility of the corporation. It also affects the capability of the corporation to take and manage essays. It compromises agencys strength and assets too.There shou ld be an effective C&A system to take care security of assets, personnel and operations and that could assure that the corporation is capable overflowing to meet its functional requirements. The field of study Institute of Standards and Technology Special event 800-37, Accreditation of Federal Information Systems and Guide for the Security Certification provides the framework under 2002 act named as the Federal Information Security Management Act, cosmos Law 107-347, for how C&A program of this corporation should be implemented. unretentive security policy and plan The security policy and plan of the current information of PBGC are not accord to the guidance provided by National Institute of Standards and Technology Special (NIST) under Federal Information Security Management Act. NIST has developed guidance and standards. It also includes minimum requirement to provide sufficient security of information for all agency assets and operations Change in organizational structure I n 2006 the reorganization of the OIT i. e. ffice of information engineering had badly affected the Information System Security Officers ability to ensure appropriate operational security for PBGCs information system. It affected the clarity for officer in terms of his responsibilities and accountability. It made it expectant for the officer to establish security standards and procedures. Internal control weaknesses High risk is being involved in the PBGCs single-employer pension insurance program. The program had an accumulated deficit of $5. 4 billion in 2003 which was the largest one in history of the corporation.Under mount also increased dramatically in private pension system. The deficit was due to the following reasons bankrupt trues under funded pension plans were ceased, there was a drawback in funding rules, stock market and interest rates decline, companies went global and economy is rancid into knowledge based economy. The company had taken steps to improve the cozy control for premiums. This is being done for two reasons. First Safeguard of assets controls must(prenominal) be establish to ensure that cost and obligation are according to the law applicable and assets are safeguarded against any loss or related factors.Second reason is Financial Reporting it is to ensure that proper insurance coverage is being done of all the revenues and expenditures so that documentation and reports can be made and are accurate. Data Quality Weaknesses Incorrect data entry, adjustments, and system- retrovertd dimensions generate errors. Because of the data quality issue, the corporation is unable to ensure the accuracy and completeness of premium data by utilizing Past Due Filing Notices and Statements of Account.The 1st one used to notify plans which had not yet submitted premium filings and 2nd one is used to ensure that underpaid/overpaid premiums from a plan sponsor could be select out effectively. During auditing it was being noticed that these two to ols are not being used timely as it requires significant resources before mailing. Due to this, premiums could not be collected and errors could not be detected. Additionally policies and procedures have not been documented, communicated, or implemented throughout PBGC which is related to the premium accounting cycle. www. pbgc. gov,2008). duty Strategy The new investment strategy is being formulated to balance risk and return and to improve chances of reaching full funding over the long run. According to this strategy diversified set of fixed-income investments and diversified lawfulness investments both will be given 45% of its assets each and 10% will be given to alternative investment. Financial Information A deficit of $18. 1 billion was being posted by insurance program for single-employer pension plans in fiscal year 2006.Due to the air hose relief provisions in the Pension Protection Act, the corporation managed to lessen its probable liabilities. This led to a $4. 7 bill ion net improvement. It announces supreme insurance benefit for 2009. The amount would be higher for those who retire later on and vise versa. The corporation had a peak year in 2000 when they had a surplus of $10 billion almost which was followed by surplus of $8 billion in 2001. The corporation got the calls in order to stop charging premiums. It got around $9 billion claims in 2002. The claims were because of airline and steel industry. (www. soa. org, n. d. ).