A method under which the excess of the actuarial present value of projected benefits over the actuarial accrued liability in respect of each individual included in an actuarial valuation is allocated on a level basis over the earnings or service of the individual between the valuation date and assumed exit. The portion of this actuarial present value, which is allocated to a valuation year, is called the normal cost. The actuarial accrued liability is determined using the unit credit actuarial cost method. (ASOP No. 4)
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