How should pension deficits be valued?

A report recently published by Punter Southall Transaction Services, a pensions consultant, reveals, rather alarmingly, that pension deficits are not always given sufficient consideration in investment decisions.

The pension deficits of the FTSE100 companies, calculated in accordance with accounting standard FRS17, make up about 3 per cent of the total market capitalisation of those companies. Within this there is huge variation, with some companies having pension deficits of more than 30 per cent of their market capitalisation.

See full Article (paid subscription required). Also see Punter Southall Transaction Services Report, in pdf format.