The municipality of Betaville disclosed the following information about its pension plan. The information is displayed differently from the example in this chapter, and is meant to illustrate yet another format used in CAFRs.
1. Calculate the funded ratio, the benefits coverage ratio, and the ratio of investment earnings to benefits for both years. Assume that an 80 percent funded ratio was considered the rule of thumb for adequate funding, that holding 15 times net assets to benefits paid was the standard for benefits coverage and that the ratio of investments to benefits should always be over 1.0.
2. How did Betaville’s pension fund compare to these benchmarks? What trends do you observe?
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