Background Note | HBS Case Collection | 2008 (Revised from original 2007 version)

The U.S. Retirement Savings Market and the Pension Protection Act of 2006

Abstract

Provides an overview of the evolution of the private retirement savings market in the U.S. since 1990; the management and administration of defined-contribution (DC) plans; the existing evidence about the investment and savings decisions of participants in DC plans; and the Pension Protection Act of 2006.

Keywords: Investment; Personal Finance; Saving; Government Legislation; Retirement; Business and Government Relations; Financial Services Industry; United States;

Format: Print

9 pages

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Citation:

Viceira, Luis M., and Helen Tung. "The U.S. Retirement Savings Market and the Pension Protection Act of 2006." Harvard Business School Background Note 207-130, January 2008. (Revised from original June 2007 version.)

Financial Accounting Foundation chairman Jack Brennan is under pressure from private-company interests to set up a new body—the Private Company Council—to determine separate GAAP for private companies. PCC advocates—including the US Chamber of Commerce—argue that traditional US GAAP has too many disclosure and fair-value requirements that impose very high compliance costs on private companies. But there are influential players—including the Big Four auditors—who oppose creating the PCC. They argue that the compliance costs of traditional GAAP are the price of high-quality accounting standards. Balancing these powerful interests, Brennan must make a decision on the PCC; at stake is US GAAP's ability to facilitate capital allocation decisions in the economy.

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The U.S. Retirement Savings Market and the Pension Protection Act of 2006

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