LensCrafters 2015 Annual Report Download - page 144

Notes to the consolidated financial statement as of December 31, 2015 Page 50 di 68
The sensitivity of the defined benefit obligation to changes in the significant assumptions is (amounts in thousands):
Impact on defined benefit obligation
(in thousands of Euro) Change inassumption Increase in assumption Decrease in assumption
Pension
Plan
SERPs
Pension
Plan
SERPs
Discount rate 1.0% (84,530) (732) 108,151 840
Rate of compensation increase 1% for each age group 7,996 698 (7,138) (512)
The sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this
is unlikely to occur. When calculating the sensitivity of the defined benefit obligations to significant actuarial assumptions, the
same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the
reporting period) has been applied as when calculating the liabilities recognized within the statements of financial position.
Plan Assets— The Plan’s assets are invested in accordance with an Investment Policy that describes the guidelines and
principles that the Luxottica Group ERISA Plans Compliance and Investment Committee intends to follow when making
decisions on the management and investment of assets of the Plan. The Plan’s long-term investment objectives are to generate
investment returns that provide adequate assets to meet the Plan’s benefit obligations and to maintain sufficient liquidity to pay
benefits and administrative expenses.
In 2015, a new investment policy was implemented which applies a dynamic asset allocation strategy. A dynamic asset
allocation strategy invests in both return-seeking assets and liability-hedging assets and the allocation between these asset
classes varies based upon the Plan’s funded ratio. Return-seeking assets consist of funds focused on U.S. equity, global equity,
non-US equity and global REITs. Liability-hedging assets are fixed income investments. As the funded ratio of the Plan
increases, the weight of liability-hedging assets increases. As of December 31, 2015, the Plan’s asset allocation was within the
guidelines described in the investment policy. The table below shows the asset classes as percentage of total assets:
Asset Category
Asset Class as a
Percent of Total
Assets
Fixed income Funds 34%
U.S. Equity Funds 22%
International and Global Equity Funds 37%
Global real estate funds 6%
Money marlet funds 1%
Cash and Equivalents 0%
Plan assets are invested in various funds which employ both passive and active management strategies. Passive strategies
involve investment in an exchange-traded fund that closely tracks a particular index while active strategies employ investment
managers seeking to manage the fund’s performance. Certain transactions and securities are not authorized to be conducted or
held in the pension trusts, such as purchase or sale of commodity contracts, illiquid securities or real estate, nonagency
mortgage, and American Depositary Receipts (ADR) or common stock of the Company’s parent, Luxottica Group S.pA. Risk
is further controlled both at the asset class and manager level by assigning benchmarks and performance objectives. The
investment managers are monitored on an ongoing basis to evaluate performance against these benchmarks and performance
objectives.
Contributions—U.S. Holdings expects to contribute Euro 44.1 million to its pension plan and Euro 0.5 million to the SERP
in 2016.