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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: bentway who wrote (516137)	9/25/2009 3:58:55 PM
From: i-node	Read Replies (2) \| Respond to of 1579723

One final note: The Trustees and actuaries give the $10.4-trillion figure and others what is called "present value," a theoretical lump-sum figure that takes into account expected future inflation and interest rates. Otherwise, any continuing deficit projected into the infinite future would automatically become an infinitely large sum. Anyone who thinks a "present value" is a "theoretical lump-sum figure" doesn't have a freaking clue what they're talking about. I mean not a clue. Of course, we know that factcheck.org is a liberal organization. The argument seems to be, "We don't know if it is $10 Trillion or $15 Trillion, so we should act like it doesn't exist at all." As a CPA, I take issue with that approach. If you know there is a liability but can't pin down the amount, it doesn't absolve you of the responsibility of reporting it. Unless you're ENRON's auditors. The same association of actuaries has this to say on the very subject (from their website): "Many observers question the reliability or usefulness of calculating Social Security’s unfunded obligation over 75 years, given the uncertainty of economic and demographic trends over such a long period. Calculations over an infinite period are even less reliable. The resulting uncertainty limits the value of the infinite-horizon projection to policymakers. " If one reads the entire document, it says in effect, "these are very long-term actuarial analyses and you can't predict whether the economic assumptions are accurate" (although the actuarial portion is quite straight forward). So, we're better off just leaving it out? They stopped short of that statement. This, of course, is at odds with the CPA's requirements of conservatism, that when an unfunded liability exists you book it.