Audi 2012 Annual Report Download - page 237

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31 Provisions for pensions
Provisions for pensions are created on the basis of plans to provide retirement, disability and
surviving dependant benefits. The benefit amounts are generally contingent on the length of
service and the remuneration of the employees.
Both defined contribution and defined benefit plans exist within the Audi Group for retirement
benefit arrangements. In the case of defined contribution plans, the Company pays contributions
to public or private-sector pension plans on the basis of statutory or contractual requirements,
or on a voluntary basis. Payment of these contributions releases the Company from any other
benefit obligations. Current contribution payments are reported as an expense for the year in
question. With regard to the Audi Group they total EUR 303 (281) million. Of this, contributions
of EUR 286 (268) million were paid in Germany toward statutory pension insurance.
The retirement benefit systems are based predominantly on defined benefit plans, with a distinc-
tion being made between systems based on provisions and externally financed benefit systems.
The domestic and foreign benefit claims of those with entitlement to a pension from the Company
pension scheme are calculated in accordance with IAS 19 (Employee Benefits) on the basis of
the projected unit credit method. This measures future obligations on the basis of the pro rata
benefit entitlements acquired as of the balance sheet date. For purposes of measurement, trend
assumptions are used for the relevant variables affecting the level of benefits.
The retirement benefit scheme within the Audi Group was evolved into a pension fund model
in Germany on January 1, 2001. The retirement benefit commitments for this model are also
classified as defined benefits in accordance with the requirements of IAS 19. The remuneration-
based annual cost of providing employee benefits is invested in mutual funds on a fiduciary
basis by Volkswagen Pension Trust e.V., Wolfsburg. This model offers employees the opportunity
of increasing their pension entitlements, while providing full risk coverage. As the mutual fund
units administered on a fiduciary basis satisfy the requirements of IAS 19 as plan assets, these
funds were offset against the derived retirement benefit obligations.
The amounts recorded in the Balance Sheet for benefit obligations are presented in the follow-
ing table:
EUR million Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2010 Dec. 31, 2009 Dec. 31, 2008
Present value of externally
funded defined benefit
obligations 1,009 723 679 586 464
Fair value of plan assets 844 714 670 583 471
Financing status (balance) 165 10 9 3 – 7
Due to the limit on a defined
benefit asset amount not
capitalized under IAS 19 ––– – 7
Present value of defined
benefit obligations not
externally funded 3,305 2,495 2,322 2,096 1,946
Provisions for pensions
recognized in the Balance Sheet 3,470 2,505 2,331 2,098 1,946