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Unilever Annual Report & Accounts and Form 20-F 2001
NOTES TO THE CONSOLIDATED ACCOUNTS
Unilever Group
>71
Financial Statements
17 Pensions and similar obligations continued
US GAAP accounting:
The following tables summarise the balance sheet impact, as well as the benefit obligations, assets, funded status and economic
assumptions associated with the key defined benefit pension plans and the other benefit plans as computed in accordance with SFAS 87
and SFAS 106. At 31 December 2001 these pension plans represented approximately 76% (2000: 76%; 1999: 79%) of all pension plans
while 100% of the other benefit plans are represented (2000: 100%; 1999: 100%), based on the market value of the funds plus the
provisions held in the Group’s accounts.
million million million million
Other Other
Pension Pension benefit benefit
plans plans plans plans
2001 2000 2001 2000
Change in benefit obligations
Benefit obligations at 1 January 12 047 9 958 1 132 748
Service cost 252 231 20 16
Interest cost 737 698 83 64
Plan member contributions 1–––
Amendments 90 ––1
Plan mergers 41 1 097 ––
Actuarial (gains)/losses 291 225 –(14)
Acquisitions/disposals (11) 621 (12) 349
Settlements/curtailments (31) (39) (3) (2)
Special termination benefits 29 32 11
Benefits paid (873) (762) (89) (61)
Currency retranslations 177 (14) 39 30
Benefit obligations at 31 December 12 750 12 047 1 171 1 132
Change in plan assets
Fair value of plan assets at 1 January 15 401 13 838 33
Plan mergers –1 397 ––
Actual return on plan assets (928) 385 ––
Acquisitions/(disposals) (11) 987 ––
Settlements (31) (39) ––
Employer contribution/surplus refunds (144) (361) 88 60
Plan member contributions 1––1
Benefits paid (873) (762) (89) (61)
Currency retranslations 145 (44) 1–
Fair value of plan assets at 31 December 13 560 15 401 33
Funded status at 31 December 810 3 354 (1 168) (1 129)
Unrecognised net transition liability/(asset) (247) (309) 33
Unrecognised net actuarial loss/(gain) (1 119) (3 437) (85) (76)
Unrecognised prior service cost 201 127 54
Other (SFAS 112 liabilities) n/a n/a (39) (16)
Net amount recognised at 31 December (355) (265) (1 284) (1 214)
Amount recognised in the statement of financial position consists of:
Prepaid benefit cost 813 797 ––
Accrued benefit liability (1 168) (1 062) (1 283) (1 214)
Additional minimum liability (20) (11) ––
Intangible asset 46––
Accumulated other comprehensive income 16 5(1) –
Net amount recognised at 31 December (355) (265) (1 284) (1 214)
Other Other Other
Pension plans Pension plans Pension plans benefit plans benefit plans benefit plans
%%%%%%
2001 2000 1999 2001 2000 1999
Weighted-average assumptions
as at 31 December
Discount rate 6.00 6.25 6.25 7.25 7.50 7.50
Expected return on plan assets 7.75 7.25 7.25 n/a n/a n/a
Rate of salary increases 3.75 3.75 3.75 4.50 4.50 4.50
Cost of living increases 2.50 2.50 2.50 n/a n/a n/a
The valuations of other benefit plans typically assume that medical cost inflation will fall from its current level (assumed to be approximately
7.5% in 2001) over the next few years and reach a constant level of approximately 5% within five years.