Tyson Foods 2015 Annual Report Download - page 39
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Please find page 39 of the 2015 Tyson Foods annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Description
Judgments and Uncertainties
Effect if Actual Results Differ From
Assumptions
Accrued self-insurance
Weareself-insuredforcertainlossesrelatedto
healthandwelfare,workers’compensation,auto
liabilityandgeneralliabilityclaims.
Weuseanindependentthird-partyactuarytoassist
indeterminingourself-insuranceliability.Weand
theactuaryconsideranumberoffactorswhen
estimatingourself-insuranceliability,including
claimsexperience,demographicfactors,severity
factorsandotheractuarialassumptions.
Weperiodicallyreviewourestimatesand
assumptionswithourthird-partyactuarytoassist
usindeterminingtheadequacyofourself-
insuranceliability.Ourpolicyistomaintainan
accrualwithinthecentraltohighpointofthe
actuarialrange.
Ourself-insuranceliabilitycontainsuncertainties
duetoassumptionsrequiredandjudgmentused.
Coststosettleourobligations,includinglegaland
healthcarecosts,couldincreaseordecreasecausing
estimatesofourself-insuranceliabilitytochange.
Incidentrates,includingfrequencyandseverity,
couldincreaseordecreasecausingestimatesinour
self-insuranceliabilitytochange.
Wehavenotmadeanymaterialchangesinthe
accountingmethodologyusedtoestablishourself-
insuranceliabilityduringthepastthreefiscalyears.
Wedonotbelievethereisareasonablelikelihood
therewillbeamaterialchangeintheestimatesor
assumptionsusedtocalculateourself-insurance
liability.However,ifactualresultsarenotconsistent
withourestimatesorassumptions,wemaybe
exposedtogainsorlossesthatcouldbematerial.
A10%increaseintheactuarialestimateatOctober
3,2015,wouldresultinanincreaseintheamount
werecordedforourself-insuranceliabilityof
approximately$27million.A10%decreaseinthe
actuarialestimateatOctober3,2015,wouldresult
inadecreaseintheamountwerecordedforourself-
insuranceliabilityofapproximately$3million.
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