Understanding End of Service Benefit and the Importance of Actuarial Valuation

End of Service Benefits (EOSB) are crucial components of employee compensation, particularly in regions like the Gulf Cooperation Council (GCC) countries, including the United Arab Emirates (UAE). These benefits serve as financial security for employees upon the conclusion of their employment tenure. To ensure that organizations can meet these obligations, conducting an Actuarial Valuation is essential. This process assesses the present value of future liabilities, enabling companies to make informed financial decisions and maintain compliance with accounting standards such as the International Accounting Standard 19 (IAS 19). Understanding End of Service Benefits (EOSB) End of Service Benefits are lump-sum payments that employees are entitled to receive when they leave an organization. These benefits are designed to reward employees for their service and provide financial support during their transition. In the UAE, for instance, EOSB includes gratuity payments, return air...