Is Actuarial Valuation Needed if Gratuity is Paid as Part of CTC? Seeking Insights

In case a company is not following the Payment of Gratuity Act and instead pays the gratuity to its employees as part of CTC when the employee leaves the organization, whether actuarial valuation is required or not. The company is not funding the gratuity liability and creates a provision for the liability in the books based on internal calculations. It should be noted that as per AS-15, the company falls under one of the categories where valuation is mandatory. Different views are being received on this matter; can anyone suggest?

You should get the actuarial valuation done to ensure the correct provision of liability in the books.

Yes, it is advisable to get the valuation done as your organization comes under the purview of AS 15. Furthermore, the provisions of the Gratuity Act are applicable to your organization, whether you create a separate Trust to manage the liability or not.