FAQ 912: PPA Reports - Estimated Share of Contributions Report

Problem: How does the system prorate the contribution on the Estimated Share of Contributions Report?

Solution: By default, the system prorates the minimum required contribution. You also have the option of adding another contribution up to the maximum allowable contribution to be prorated by individual. Enter an amount in the Alternate Contribution field of the Reports > Valuation > PPA DB... menu. The allocation to actives is based on the sum of the individual's funding target and normal cost. For end of year valuations only, a share of the contribution will be allocated to participants who have terminated within the past twelve months. The allocation to these terminated participants will be based on their vested funding target and vested target normal cost. An individual's allocation will be based on their individual total divided by the sum for actives and participants who terminated in the past twelve months. The funding target and normal cost for this calculation are based on assumptions used to calculate the minimum required contribution. EXAMPLE: 250,000 - contribution being allocated (either the Minimum Required Contribution or the Alternate Contribution input) 200,000 - Total Plan TNC for actives and participants who terminated in the past twelve months 350,000 - Total Plan FT for actives and participants who terminated in the past twelve months 95,000 - TNC for the participant 185,000 - FT for the participant 250,000 / (200,000 + 350,000 ) x (95,000 + 185,000) = 127,273 participant's share of contribution