The financial strengths of defined-benefits pension funds have come under increasing scrutiny because differing methods of gauging the strength of a fund have spurred confusion.

Changes in the actuarial assumptions used by ratings agencies to determine the likelihood a pension system would be able to pay its promised benefits decades from now have put pressure on public and corporate plan sponsors forcing them to decrease costs. These changes come at the same time they look for ways to increase returns on investments.

A brief by the American Academy of Actuaries explains how different accounting methods used to measure the health of a pension fund create different results as to the solvency of a retirement plan.