Analysis of 1199 SEIU Benefit and Pension Fund’s Revenue
The 1199 SEIU Benefit and Pension Fund are dedicated to the care of healthcare workers who cater to other people through services and programs that create better lives for its members and invest in the labor force to enhance the healthcare industry as well as patient care. Since the firm facilitates a pension fund, it requires employers to make contributions into a pool of funds designated for the future benefit of workers. The pool of funds is then invested on behalf of the workforce, and the revenue generates income for the employees when they retire. The grouping of revenue that my company uses is source revenue since it receives income before services are rendered.
Source revenue is most suitable for 1199 SEIU Benefit and Pension Fund due to the nature of pension funds. To illustrate this, the most common pension plan is whereby the employer guarantees the workforce will earn a certain amount of benefit after retiring, irrespective of the performance of the primary investment pool (Cheng et al, 2010). On that account, the employer is liable for a particular flow of pension payments to the retired worker Bikker (2017) states that the cash amount is determined by a method, typically by years of service and earnings. Further, if the assets in the pension plan are not adequate to pay the benefits, the firm is liable for the rest of the payment (Cheng et al, 2010). Based on this description it is suitable for the 1199 SEIU Benefit and Pension Fund to generate its revenue first so that it can determine the performance of its investment to enable it to make a firm commitment to its clients.
Bikker, J. A. (2017). Is there an optimal pension fund size? A scale-economy analysis of administrative and investment costs. In Pension Fund Economics and Finance (pp. 25-56). Routledge. San Francisco.
Cheng, C. A., Huang, H. H., Li, Y., & Lobo, G. (2010). Institutional monitoring through shareholder litigation. Journal of Financial Economics, 95(3), 356-383.