LensCrafters 2012 Annual Report Download - page 248

ANNUAL REPORT 2012> 162 |
US Holdings sponsors the following additional benefit plans, which cover certain present
and past employees of some of its US subsidiaries:
(a) US Holdings provides, under individual agreements, post-employment benefits for
continuation of health care benefits and life insurance coverage to former employees
after employment. As of December 31, 2012 and 2011, the accrued liability related to
these benefits was Euro0.5 million and Euro0.7 million, respectively.
(b) US Holdings established and maintains the Cole National Group, Inc. Supplemental
Retirement Benefit Plan, which provides supplemental retirement benefits for certain
highly compensated and management employees who were previously designated
by the former Board of Directors of Cole as participants. This is an unfunded
noncontributory defined contribution plan. Each participant’s account is credited with
interest earned on the average balance during the year. This plan was frozen as to
future salary credits on the effective date of the Cole acquisition in 2004. The plan
liability was Euro 0.7 million and Euro 0.7 million at December 31, 2012 and 2011,
respectively.
US Holdings sponsors certain defined contribution plans for its United States and Puerto
Rico employees. The cost of contributions incurred in 2012 and 2011 was Euro 8.4
million, Euro4.8 million and Euro 0.0 million, respectively, and was recorded in general
and administrative expenses in the consolidated statement of income. US Holdings also
sponsors a defined contribution plan for all U.S. Oakley associates with at least six months
of service. The cost for contributions incurred in 2012 and 2011 was Euro1.8 million and
Euro1.7 million, respectively.
The Group continues to participate in superannuation plans in Australia and Hong
Kong. The plans provide benefits on a defined contribution basis for employees upon
retirement, resignation, disablement or death. Contributions to defined contribution
superannuation plans are recognized as an expense as the contributions are paid or
become payable to the fund. Contributions are accrued based on legislated rates and
annual compensation.
Health Benefit Plans - US Holdings partially subsidizes health care benefits for eligible
retirees. Employees generally become eligible for retiree health care benefits when
they retire from active service between the ages of 55 and 65. Benefits are discontinued
at age 65. During 2009, US Holdings provided for a one-time special election of early
retirement to certain associates age 50 or older with 5 or more years of service. Benefits
for this group are also discontinued at age 65 and the resulting special termination
benefit is immaterial.
The plan liability is Euro3.5 million and Euro3.7 million at December 31, 2012 and 2011,
respectively.
The cost of this plan in 2012 and 2011 as well as the 2013 expected contributions are
immaterial.
For 2013, a 9.0 percent (9.5 percent for 2012) increase in the cost of covered health care
benefits was assumed. This rate was assumed to decrease gradually to 5 percent for 2021
and remain at that level thereafter. The health care cost trend rate assumption could have