Forms & Publications

SJCERA GLOSSARY

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Term Definition
Fiduciary Indicates the relationship of trust and confidence where one person (the fiduciary) holds or controls property for the benefit of another person. For example, the relationship between a trustee and the beneficiaries of the trust. - Under ERISA, any person who
(1) exercises any discretionary authority or control over the management of a plan or the management or disposition of its assets,
(2) renders investment advice for a fee or other compensation with respect to the funds or property of a plan, or has the authority to do so, or
(3) has any discretionary authority or responsibility in the administration of a plan. One who acts in a capacity of trust and who is therefore accountable for whatever actions may be construed by the courts as breaching that trust. Under ERISA, fiduciaries must discharge their duties solely in the interest of the participants and beneficiaries of an employee benefit plan. In addition, a fiduciary must act exclusively for the purpose of providing benefits to participants and beneficiaries in defraying reasonable expenses of the plan. See also prudent person rule.
Final Average Pay Plan A formula that bases benefits on the credited earnings of an employee at or during a selected number of years (typically 3-5) immediately preceding retirement.
Final Compensation Final compensation is a member's average monthly compensation earnable during any consecutive twelve months selected by the members (or, if he fails to select, the twelve months immediately preceding his retirement). It is used to compute his retirement allowance.
Full Time Equivalent A personnel term which refers to the value of a permanent position of one budgeted position, generally a 40-hour per week position.
Fund (1) (noun) Money in investments held in trust, or share of insurance company assets for payment of pension benefits.
(2) (verb) To set aside monies necessary to pay off a benefit, in a trust account or in the possession of an insurance company or other third party, in advance of the date when benefits are payable.