Tiscali 2008 Annual Report Download - page 90

2006 (carried out on the basis of the official cost-of-living index and
the legal interest) and the portions accrued with companies with less
than 50 employees remain as staff severance indemnities.
Following IAS 19, for estimating staff severance indemnities,
the following methods were used: the Traditional Unit Credit
Method for companies with at least 50 employees, and the
Projected Unit Credit Cost – service proportionately for the
other companies, in accordance with the following stages:
•on the basis of a series of financial hypotheses (increase in
cost of living, remuneration, etc.), the possible future benefits
which might be disbursed in favour of each employee enrolled
in the scheme in the event of retirement, decease, disability,
resignation, etc. were projected. The estimate of future benefits
includes any foreseeable increases relating to a further length
of service, and to the presumable growth of the remuneration
received as of the date of estimation, only for the employees
of companies with less than 50 employees;
•
the current average value of future benefits was calculated
as of the date of estimation, on the basis of the adopted
annual interest rate and the probability that each benefit has
of being really disbursed;
89
Other non-current liabilities (note 30)
EUR (000) 31.12.2008 31.12.2007
Payables to suppliers 13,011 24,923
Other payables 82,434 95,885
Total 95,444 120,807
Payables to suppliers represent medium/long-term trade
payables for the purchase of plant and are linked to the
stipulation of IRU contracts (indefeasible right of use) deriving
from investments relating to the LLU project.
Other payables include:
•the amount due to the former shareholders of Video
Network Ltd for the portion of the deferred price, totalling
EUR 71.2 million at 31 December 2008;
•the valorisation at fair value of the swap (IRS) recorded
by Tiscali UK Holding for EUR 9.5 million.
Liabilities for pension obligations and staff severance
indemnities (note 31)
The table below shows the period changes:
The staff severance provision, which comprises the indemnities
accrued in favour of employees, refers to the Parent Company
and the subsidiaries operating in Italy and amounted to EUR 5
million at 31 December 2008. In accordance with Italian Law
No. 297/1982, the amount due to each employee accrues
depending on the service provided, and has to be immediately
disbursed when the employee leaves the company. At the end
of the employment relationship, the amount due is calculated on
the basis of its duration and the taxable remuneration of each
employee. The liability is annually adjusted in compliance with
the official cost-of-living index and the interest envisaged by law.
It is not associated with any condition or period of accrual, or
with any obligation of financial borrowing; therefore, there are no
assets serving the provision. In compliance with IAS 19, the
provision was recorded under Plans with defined benefits.
In compliance with the new rules introduced by Italian Legislative
Decree No. 252/2005, and by Italian Law No. 296/2006 (2007
Finance Act), for the companies with at least 50 employees, the staff
severance indemnities accrued as from 2007 are ascribed either to
the Treasury Fund of the social security institute (INPS) (from 1
January) or to the supplementary pension funds (from the option
month), and acquire the nature of “Plan with defined contributions”.
However, the revaluations of the provision existing at 31 December
CONSOLIDATED FINANCIAL STATEMENTS AND EXPLANATORY NOTES
EUR (000) 31.12.2007 HFS/ Exchange Provisions Uses 31.12.2008
Discontinued difference
Staff severance indemnities 5,852 (830) (29) 2,565 (2,557) 5,001
Total 5,852 (830) (29) 2,565 (2,557) 5,001