(18) Accruals for Pensions and Similar Commitments

 

 

€k

 

Sept. 30, 2011

Sept. 30, 2010

Present value of unfunded obligations

14,882

15,005

Present value of funded obligations

198,096

202,001

Fair value of plan assets

–190,756

–195,481

Past service cost not included in profit and loss

698

750

Net liabilities

22,920

22,275

Therein amount recognized as asset

1,485

923

Accruals for pensions and similar commitments

24,405

23,198

The over-funding (amount recognized as asset) of €1,485k (2009/2010: €923k) is presented under other non-current assets.

Funded Status.

The difference between the fair value of plan assets and the present value of defined benefit obligations is referred to as the funded status. Amounts recognized for current and previous periods as per September 30 are as follows:

 

 

 

 

 

€k

 

2011

2010

2009

2008

2007

Present value of defined benefit obligation

212,978

217,006

190,620

182,409

183,797

less fair value of plan assets

–190,756

–195,481

–181,841

–174,841

–180,429

Funded status

22,222

21,525

8,779

7,568

3,368

Changes to the present value of defined benefit obligations and the fair value of plan assets may result in actuarial gains or losses, e.g., due to parameter changes. Wincor Nixdorf recognizes actuarial gains and losses directly in equity:

 

 

€k

 

2010/2011

2009/2010

Actuarial gains and losses recognized in equity in the year under review

1,132

11,659

Actuarial gains and losses recognized in equity in the previous years

10,876

–783

Accumulated actuarial gains and losses

12,008

10,876

Actuarial Assumptions.

With regard to the Group entities, the underlying actuarial assumptions (weighted average) for the valuation of defined benefit obligations are as follows:

 

 

 

 

Sept. 30, 2011

Sept. 30, 2010

Interest rate

4.7%

4.3%

Income trend

2.9%

2.8%

Pension trend

2.0%

2.0%

In addition, life expectancy assumptions have been taken into account. For Germany, the 2005G Heubeck Tables were used.

Defined Benefit Obligations.

For certain groups of employees of the Group, retirement benefit schemes are available. Schemes vary depending on the legal, economic, and tax environments of the respective country. The greater part of them qualify as defined benefit plans.

Basically, with regard to employment law, the substantial pension commitments in Germany are based upon direct performance-related commitments in terms of defined contribution plans. Each beneficiary receives, depending on individual pay-scale grouping, contractual classification, or income level, different yearly contributions. The contribution is multiplied by an age factor appropriate to the current pension scheme and credited to the individual retirement account of the employee. The retirement accounts may be used up at retirement by either a one-time pay-off or payments of ten years’ installments at maximum.

Change in Defined Benefit Obligation.

 

€k

 

Sept. 30, 2011

Sept. 30, 2010

Present value of defined benefit obligation as of October 1

217,006

190,620

Current service cost

7,068

6,696

Interest cost

9,353

9,687

Member contributions

896

848

Actuarial gains (-)/losses

–10,152

11,044

Pension payments

–422

–5,927

Curtailments

22

–509

Plan alterations

0

–70

Divestitures/Transfers

–13,342

473

Exchange rate differences

2,549

4,144

Present value of defined benefit obligation as of September 30

212,978

217,006

Plan Assets.

Plan assets were invested in the following assets:

 

 

 

 

Sept. 30, 2011

Sept. 30, 2010

Shares

17.9%

15.1%

Debt instruments

37.5%

37.5%

Real estate

7.8%

8.3%

Short-term financial investments

36.8%

39.1%

Plan assets contain neither any own financial instruments nor real estate currently used by the Group.

Change in Plan Assets.

 

€k

 

Sept. 30, 2011

Sept. 30, 2010

Fair value of plan assets as of October 1

195,481

181,841

Expected return on plan assets

10,799

10,388

Actuarial gains/losses (-)

–11,284

–615

Member contributions

896

848

Employer contributions

1,278

1,319

Pension payments

3,100

–2,600

Divestitures/Transfers

–11,631

640

Exchange rate differences

2,117

3,660

Fair value of plan assets as of September 30

190,756

195,481

The expected return on plan assets is determined based on a weighted average of 5.5% (2009/2010: 5.7%) and shown within the functional cost headings. The expected return on plan assets is derived from returns generated in the past and long-term expected returns of assets included in the plan asset. The actual result on plan assets was –€485k (2009/2010: €9,773k). For fiscal 2011/2012, employer contributions to plan assets in the amount of €1,336k are expected.

Pension Expenses.

 

€k

 

2010/2011

2009/2010

Current service cost

7,068

6,696

Interest cost

9,353

9,687

Expected return on plan assets

–10,799

–10,388

Effects from curtailments

22

–658

Returns from plan alteration

–52

–123

Pension expenses

5,592

5,214

The experience adjustments developed as follows:

 

 

 

 

 

€k

 

2010/2011

2009/2010

2008/2009

2007/2008

2006/2007

Pension obligations

2,633

2,511

2,586

–908

2,410

Plan assets

–11,284

–615

–1,315

–16,447

–1,312

Total

–8,651

1,896

1,271

–17,355

1,098

Post-employment benefit plans are classified as either defined contribution or defined benefit plans. Under defined contribution plans, an enterprise pays fixed contributions and does not assume any other obligations. The personnel expenses of the fiscal year include expenses for defined contribution plans in the amount of €28,156k (2009/2010: €27,378k). Included are expenses of subsidiaries in Belgium, the Netherlands, and Sweden for so-called multi-employer plans. According to IAS 19, these plans have to be basically treated as defined benefit plans. Since the required information of the plans is not available, the plans are treated as defined contribution plans.

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