Accumulated Benefit Obligation (ABO)
An approximate measure of the liability of a plan in the event of a termination at the date the calculation is performed. Related: projected benefit obligation. |
Similar financial terms
Unit benefit formulaMethod used to determine a participant's benefits in a defined benefit plan by multiplying years of service by the percentage of salary.
Projected benefit obligation (PBO)
A measure of a pension plan's liability at the calculation date assuming that the plan is ongoing and will not terminate in the foreseeable future.
Pension Benefit Guaranty Corporation (PBGC)
A federal agency that insures the vested benefits of pension plan participants (established in 1974 by the ERISA legislation).
Net benefit to leverage factor
A linear approximation of a factor, T*, that enables one to operationalize the total impact of leverage on firm value in the capital market imperfections view of capital structure.
Cost-benefit ratio
The net present value of an investment divided by the investment's initial cost. Also called the profitability index.
Limited-tax general obligation bond
A general obligation bond that is limited as to revenue sources.
Collateralized mortgage obligation (CMO)
A security backed by a pool of pass-throughs , structured so that there are several classes of bondholders with varying maturities, called tranches. The principal payments from the underlying pool of pass-through securities are used to retire the bonds on a priority basis as specified in the prospectus.
General Obligation Bonds
Securities issued by municipalities. The source of revenue to pay the interest and principal is taxes. These securities are also known as full faith and credit issues because they depend on the municipality's capacity to tax. These issues are often considered to be more stable than Revenue Bonds.
