Early adoption of the revised International Accounting Standard for pensions (IAS19R) is effective from 1 January.

The impact on risk management strategies will be among the first things many companies need to assess this year, according to pensions experts at Capita's employee benefits business.

IAS19R is now effective for accounting periods beginning on or after 1 January and early adoption is permitted. The amended standard requires the balance sheet to reflect immediately the full pension surplus or deficit, with assets taken at market value and liabilities assessed using a corporate bond discount rate.

The 'corridor' option, which permits the deferral of recognising some actuarial gains and losses, will be removed in 2013.

Kenneth Donaldson, head of actuarial consulting, Capita Employee Benefits, said: 'Basically, companies need to decide whether to opt for pension transparency now or in a year. With benchmark corporate bond rates down to about 4% per annum, liabilities are expected to have increased substantially so the temptation will be to protect the balance sheet from a big hit for another year.

'But, there is a compelling case for early adoption in some cases - particularly as disclosures this year must demonstrate a company's position under IAS19R as a comparison even if the standard isn't officially applicable yet. With the pension news pipeline now so visible to the market, transparency - coupled with a narrative detailing risk-management strategies - will be the best course of action for improving investor confidence for some companies.'

The accounting change has been anticipated and investors, analysts and companies will benefit from improved transparency as ease of comparison and confidence in the accuracy of reporting data improves.