Lenovo 2010 Annual Report Download - page 142

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2009/10 Annual Report Lenovo Group Limited
140
NOTES TO THE FINANCIAL STATEMENTS (continued)
36 Retirement benefit obligations (continued)
(a) Pension benefits (continued)
The movements in the liability recognized in the balance sheet are as follows:
Group
2010 2009
US$’000 US$’000
At the beginning of the year 59,115 77,264
Exchange adjustment 3,468 (2,566)
Pension expense 7,433 11,032
Contributions by employer (11,088) (19,823)
Net actuarial loss/(gain) 11,307 (6,792)
At the end of the year 70,235 59,115
The amounts recognized in the income statement are as follows:
Group
2010 2009
US$’000 US$’000
Current service cost 4,833 7,522
Interest cost 6,505 6,186
Expected return on plan assets (3,947) (4,066)
Curtailment losses 42 1,390
Total expense recognized in the income statement 7,433 11,032
The principal actuarial assumptions used are as follows:
Group
2010 2009
Discount rate 2.25%-5.25% 2.5%-5.5%
Expected return on plan assets 0%-5% 0%-4.25%
Future salary increases 2.2%-3.5% 2.2%-3.5%
Future pension increases 0%-1.75% 0%-1.75%
Cash balance crediting rate 2.5% 2.5%
Future life expectancy for those aged 60 22 22
The expected return on plan assets is derived by taking the weighted average of the long term expected rate of return
on each of the asset classes that the plan was invested in at the balance sheet date.