The Impact of Population Aging on Pension Accounting and Asset Allocation

Population aging has become a global challenge with profound implications for pension systems. This study systematically examines the multidimensional impacts of population aging on pension accounting and asset allocation. In terms of accounting, aging has driven the ongoing evolution of pension accounting standards, exemplified by the International Accounting Standards Board’s (IASB) revision of IAS 19, requiring more precise liability measurement and information disclosure. Extended life expectancy and low-interest-rate environments have increased the present value of pension liabilities, resulting in significant deficits in many corporate pension plans. Regarding asset allocation, the traditional “60/40” model faces challenges, prompting pension institutions to increase allocations to alternative assets, adopt more dynamic approaches, and enhance global diversification strategies. Technological applications, such as artificial intelligence and big data analytics, are revolutionizing asset allocation methods, improving investment efficiency and risk management capabilities. However, these changes also introduce new challenges, including algorithmic biases and data security issues. This study also explores coping strategies, encompassing pension system reforms, accounting standard adjustments, and asset allocation innovations. Future pension management may require further innovation and adaptation to accommodate evolving demographic structures and financial market environments.