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Bms 310: Pensions Question Paper

Bms 310: Pensions

Course:Bachelor Of Commerce

Institution: Kenyatta University question papers

Exam Year:2011

KENYATTA UNIVERSITY
UNIVERSITY EXAMINATIONS 2011/2012
FIRST SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR OF
COMMERCE
BMS 310: PENSIONS
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DATE: Wednesday 30th November 2011 TIME: 8.00 a.m – 10.00 a.m
INSTRUCTIONS
Answer Question ONE and any other TWO Questions.
Question One
a) Momanyi has been making monthly contribution of ksh. 2500 to a pension scheme which pays a fixed interest rate 4.5%. What is the total sum amount that should be to him due after 10 years of service with the employer. (6 marks)

b) Discuss FIVE regulations that govern the investment of pension funds in Kenya. (8 marks)
c) Highlight FOUR economic and final assumptions made when estimating the cost of defined benefit plan. (4 mark)

d) Retirement Benefits Authority was formed through an Act of Parlimanet. Discuss THREE reasons for the establishment of this Authority. (6 marks)

Question Two
a) Members of a pension scheme should have timely and up to date financial information of scheme activities. Discuss FIVE ways in which pension schemes can prudently report financial information to the members. (10 marks)

b) Distinguish between lump sum retirement benefit and lump sum death benefit. (4 marks)
c) Discuss THREE ways in which pension on retirement could be provided to retirees. (6 marks)

Question Three
a) Discuss the different types of pension plans used in Kenya highlighting at least two advantages and one advantage for each type of pension plan discussed. (10 marks)

b) Discus the legal provisions that retirement benefits Authority have put in place to guide the operations of pension schemes in Kenya. (10 marks)

Question Four
a) Despite the interim and definitive trust deeds, briefly discuss THREE other types of deeds that are used to manage pension schemes. (6 marks)

b) The law clearly stipulates the eligibility of appointment as a trustee. It further stipulates ways to remove a trustee in office. Discuss SEVEN ways in which trustees may be removed from office.(14 marks)

Bms 310: Pensions Question Paper

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