Glossary

Net Pension Liability (NPL) - Each employer’s share of the unfunded liability (Total Pension Liability) minus the Pension Plan’s Fiduciary Net Position) associated with their employees and retirees who participate in the plan.
 
Discount Rate - A blended or single rate (expressed as a percentage) that reflects (1) the long-term expected rate of return on pension plan investments to the extent (a) this rate will support projected benefit payments of the plan, and, (b) assets will be invested using the current allocation targeted to achieve that return; and (2) for the period that benefit payments not supported will incorporate an index rate for 20-year tax-exempt municipal bonds.
 
Pension Expense (PE) - Changes in KRS’ Net Pension Liability, recognized in the current reporting period, plus changes due to differences between expected and actual experience, changes in economic and demographic assumptions, and the difference between projected and actual earnings on pension plan investments that are factored into the PE calculation over a period of years.
 
Fiduciary Net Position (FNP) – A plan’s net assets at market value.
 
Proportionate Share – Portions of a plan’s collective Net Pension Liability, collective Pension Expense and other disclosure items of the plan related to pensions—attributable to a specific employer.
 
Total Pension Liability (TPL) - The portion of the actuarial present value of projected benefit payments (reflecting projected service and anticipated salary and benefit increases) that is attributed to past periods of member service. TP is similar to current Actuarial Accrued Liability (AAL) determined under the Entry Age Normal Actuarial Cost Method, using the Discount Rate.