ACAW Reports and Investments
Solidly grounded in governance and oversight, our pension plan grows with confidence and reliability.
The ACAW Pension Plan continues to be in stable financial condition, as of December 31, 2022, with 2.1 billion dollars in assets and a funding ratio of 132%. Investment experience has been consistently favorable, with a 6-year average net rate of return of 7.7%. The plan’s solvency ratio of 153% demonstrates its ability to pay both current and future benefits as promised, with a surplus. Expenses were kept to a minimum with operating costs equaling less than 0.1% of assets.
Investment Size
As a result of stewardship by the ACAW Pension Plan Board of Trustees, the asset value of the Pension Plan has risen from a value of $400 million to a value of 2.1 billion dollars today.
Assets have been steadily increasing over the years, with occasional fluctuations in growth rate. In 2022, assets reached $2,144,568,072, which reflects an increase of about 13% from end of year 2020 to end of year 2022.
Investment Distribution
On December 31, 2022, the Pension Fund held a diversified portfolio consisting of equities, fixed income securities, and alternative investments valued at over 2 billion dollars, with the aim of achieving long-term returns.
Going-Concern Assets vs Going-Concern Liabilities
The ACAW Pension Plan’s financial health can be better understood through the Actuarial Valuation Report as at Dec 31, 2022, which provides important information about the pension fund’s going-concern liabilities and assets.
According to the report, the pension fund’s going concern liabilities, including provisions for adverse deviation (PfAD), amounted to $1.53 billion. This represents the estimated amount of money required to meet future pension obligations. The going concern assets of the pension fund, which represent the estimated value of its investments, amounted to $2.1 billion.
Based on these figures, the funding ratio of the ACAW Pension Plan stands at 132.3%, indicating that the pension fund has more assets than liabilities. This is a key indicator of the plan’s financial well-being, providing plan member’s a secure foundation, and enhancing the overall sustainability of the pension fund.
What is an Actuarial Valuation Report?
To ensure the financial stability of our Pension Plan, Canadian pension legislation mandates that an actuarial valuation be performed regularly. This review is conducted by an actuary, who is a risk management expert with specialized skills in mathematics and statistics. They thoroughly examine various factors such as contributions, member demographics, and retirement patterns, to determine whether the Plan has sufficient assets to finance the promised pensions. This valuable information helps to ensure the long-term sustainability of the Plan.
Our next valuation as of December 31, 2023, is scheduled to be completed in September 2024.