Valuing Tax Losses

The “Unit Pricing Practices” paper by a Society Unit Pricing Working Party presented in December 2009 identified a lack of industry consensus to the approach for placing value on tax losses in unit pricing of ‘I-E’ funds. 



 

This presentation which is based on a paper “Placing Value on Tax Losses in the Unit Pricing of Life Company Internal Funds”, examines for both expanding and contracting ‘I-E’ funds:



(i)       philosophical problems with some of the current approaches to placing value of tax losses;



(ii)     the circumstances in which value may reasonably be placed on tax losses;



(iii)    algorithms for placing a value on tax losses;



(iv)    methods for judging the merits of algorithms for placing value on tax losses; and



(v)     regulatory issues arising from any new market consensus on placing value on tax losses. 



 

As part of the presentation, the unit pricing implications of using different tax loss value algorithms will be illustrated graphically.

To access podcast please contact the Society: info@actuaries.ie