Tiscali 2007 Annual Report Download - page 137

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EUR (000) 31.12.2007 31.12.2006
Tiscali International BV 234,270 206,223
Tiscali B.V. - 8
Tiscali Motoring S.r.l. 69 74
Tiscali Italia S.p.A. 509 3
Tiscali Services S.p.A. 927 -
Quinary SpA 268 -
Tiscali International Network SpA 3 -
Tiscali International Network BV - 1,839
Tiscali International Network SA 16 16
Total 236,062 208,162
The distribution by expiry of Other non-current liabilities is as
follows:
EUR (000) 31.12.2007 31.12.2006
1-5 years 1,792 1,939
beyond 5 years 234,270 206,223
Total 236,062 208,162
22. Liabilities for pension obligations and staff
severance
The table below shows the period movements:
EUR (000) 31.12.2006 Provisions Utilisation 31.12.2007
Staff severance 401 343 (399) 345
Total 401 343 (399) 345
The staff severance fund of EUR 0.3 million, chiefly covering
amounts payable to employees, relates to the parent company
and subsidiaries operating in Italy.
In accordance with the matters envisaged by Italian laws and reg-
ulations, the amount due to each employee accrues in relation to
the service rendered and must be paid out immediately if the
employee leaves the Company. The indemnity due on termination
of the employment relationship is calculated according to Italian
statutory and employment law provisions with reference to the
duration of said relationship and the assessable remuneration of
each employee. The liability, adjusted annually in relation to the
official cost of living index and the interest envisaged by law, is not
associated with any condition or period of accrual, nor any finan-
cial funding obligation; therefore, there are no assets serving the
provision. Pursuant to IAS 19, the provision has been recorded
as a “Defined benefit plan”.
On the basis of the new legislation introduced by Italian Legisla-
tive Decree No. 252/2005 and Italian Law No. 296/2006 (2007
Finance Bill), with regard to companies with at least 50 em-
ployees the portion of severance indemnity (T.F.R.) accrued as
from 2007 will be allocated to either an INPS Treasury Fund (as
from 1 January) or to supplementary welfare schemes (from
the month of option) and will adopt the nature of a “Defined
contribution plan”. The revaluations of the provisions existing
at 31 December 2006, made in relation to the official cost of
living index and the legal interest, and the portions accrued
within companies with less than 50 employees, will remain
recorded under the severance indemnity (T.F.R).
In accordance with IAS 19, the following methods have been
adopted in order to value the severance indemnity: the Tradi-
tional Unit Credit Method, for companies with at least 50 em-
ployees and the Projected Unit Credit Cost
–
service pro rate,
for the others broken down into the following phases:
3the possible future benefits which could be disbursed in fa-
vour of each employee enrolled in the plan in the event of re-
tirement, decease, disability, resignation, etc., have been
projected on the basis of a series of financial hypotheses (in-
crease in the cost of living, increase in remuneration, etc.). The
estimate of the future benefits takes into account any forese-
eable increases corresponding to the additional length of ser-
vice as well as the presumable increase in the level of
remuneration received as of the valuation date only for emplo-
yees of companies with less than 50 employees;
3the current average value of the future benefits has been cal-
culated as of the date of the valuation, on the basis of the an-
nual interest rate adopted and the probability that each benefit
must be effectively disbursed;
Financial assumptions
Inflation rate: 2%
Discount rate: 5,6%
Demographic assumptions:
Mortality: ISTAT 2002 M/F mortality
tables with reference also
to SIM 2002 and SIF 2002
Disability: INPS 1998 M/F disability
tables
Resignation: 4% from 20-65 years
Anticipated payments: 1% according to age
Retirement: 65 for men and
60 for women, with
maximum length of service
of 40 years.
23. Provisions for risks and charges
A breakdown of the provision covering risks and charges is as follows:
EUR (000) 31.12.2006 Provisions Utilisation 31.12.2007
Provisions for risks and charges 26,347 1,923 (6,208) 22,062
Total 26,347 1,923 (6,208) 22,062
TISCALI S.P.A. – SINANCIAL STATEMENTS AT 31 DECEMBER 2007
136