The IAS 19 accounting standard is falling short in providing enough clarity around pension scheme funding requirements and risk, research from Lincoln Pensions has found.

The consultancy firm has revealed in a report that one-fifth of FTSE 350 companies with a defined benefit (DB) pension scheme do not disclose their funding deficit or surplus position.
Over a quarter fail to reveal the length of their recovery plans, and a fifth do not disclose the amount of deficit repair contributions they are committed to paying into their schemes.
"DB pension schemes are often one of, if not, the largest obligations for a corporate sponsor," Lincoln Pension MD Richard Farr, said. "Without full disclosure, how can financial statements ever be true and fair?
"While there have been significant improvements made in basic corporate disclosures over the past 18 months, we believe that a continued push is absolutely necessary."
The IAS 19 accounting standard concerns employee benefits like pensions and life insurance, and falls under the IFRS rules set by the International Accounting Standards Board.
Lincoln Pensions called on schemes to disclose more prudent and comparable funding targets to enable comparisons between companies, and to show the full reliance placed on the employer covenant.
The consultancy also said value at risk (VaR) calculation details could be useful to understand the inherent risks for assets and liabilities if modelled correctly and understood by users.
In addition, schemes are advised to disclose the technical provisions (TP) funding position, and details of the associated recovery plan durations and contributions agreed.
It is hoped that this will show the actual cash funding commitments to the scheme, and also show who need longer to pay.
Farr said it was important for schemes to be open, adding: "As anyone experienced in financial refinancing and restructuring will tell you, denial is the biggest obstacle to an effective and efficient solution for all stakeholders."