BMW 2008 Annual Report Download - page 106

107 Group Financial Statements
Germany United Kingdom Other Total
in euro million 2008 2007 2008 2007 2008 2007 2008 2007
Balance sheet amounts at  January 3,849 4,414 647 439 127 164 4,623 5,017
Deconsolidation effects – 4 – 4 – – – – –
Expense from pension obligations 293 239 7 6 52 30 28 399 319
Pension payments or transfers to external funds –1,471 – 80 – 98 – 47 –14 – 67 –1,583 –194
Actuarial gains (–) and losses (+)
on defined benefit obligations – 271 – 776 – 647 211 –1 8 – 919 – 557
Actuarial gains (–) and losses (+) on plan assets 278 – 486 42 104 2 868 44
Employee contributions to the deferred
remuneration retirement scheme 20 52 – – – – 20 52
Translation differences and other changes –1 – –123 – 50 27 – 8 – 97 – 58
Balance sheet amounts at  December 2,693 3,849 345 647 273 127 3,311 4,623
thereof pension provision 2,693 3,849 345 651 276 127 3,314 4,627
thereof pension assets (–) – – – – 4 – 3 – – 3 – 4
Pension provisions relating to pension plans in other coun-
tries amounted to euro  million (: euro  million).
This includes euro  million (: euro  million) relating
to externally funded plans.
The change in the defined benefit obligations was attribut-
able mainly to changes in the discount rates used in the
actuarial computation. In addition, exchange rate changes,
in particular the depreciation of the British pound, had a
substantial impact on the measurement of the defined
benefit obligations and fund assets.
The changes in the pension provision and pension as-
sets
(reimbursement claims or right to reduce future
contributions
to the funds) as disclosed in the balance
sheet can be derived as follows:
The defined benefit plans of the BMW Group give rise to
an expense from pension obligations in the financial year
The expense from reversing the discounting of pension
obligations and the income from the expected return on
plan
assets are reported as part of the financial result. All
other components of pension expense are included in the
relevant income statement under costs by function.
Depending on the risk structure of the pension obligations
involved, pension plan assets are invested in various in-
vestment classes, the most predominant one being bonds.
 of euro  million (: euro  million), comprising
the following components:
Other equity instruments, property and alternative invest-
ments (e. g. infrastructure funds) are also considered.
The expected rate of return is derived on the basis of the
specific investment strategy applied to each individual
pension fund. This is determined on the basis of the rates
of return from the individual investment classes taking
account of costs and unplanned risks. This approach re-
sulted in the following expected rates of return on plan
assets (disclosed on the basis of weighted averages).
Germany United Kingdom Other Total
in euro million 2008 2007 2008 2007 2008 2007 2008 2007
Current service cost 117 150 59 64 31 29 207 243
Expense from reversing the discounting of pension obligations 209 192 316 323 25 22 550 537
Past service cost –1 –103 4 – –1 – 2 –103
Expected return on plan assets (–) – 32 – – 303 – 335 – 25 – 23 – 360 – 358
Expense from pension obligations 293 239 76 5 2 30 2 8 399 319