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92 Notes to the consolidated accounts
Unilever Group
Unilever Annual Report & Accounts and Form 20-F 2002
17 Pensions and similar obligations continued
US GAAP disclosures
Under US GAAP, the actuarial assumptions used to calculate the benefit obligations are set by reference to market conditions at the balance
sheet date, in a similar manner to that used under FRS 17. The accounting methodology however is not the same as under FRS 17 since
certain cost items are amortised rather than recognised immediately.
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 post retirement benefit plans as computed in accordance
with SFAS 87 and SFAS 106. At 31 December 2002 these key defined benefit pension plans (‘key pension plans’) represented approximately
90% (2001: 76%; 2000: 76%) of all pension plans while 100% of the other post retirement benefit plans are represented (2001: 100%;
2000: 100%), based on the market value of the funds plus the provisions held in the Group’s accounts.
million million million million
Key Key Other post Other post
pension pension retirement retirement
plans plans benefit plans benefit plans
2002 2001 2002 2001
Change in benefit obligations
Benefit obligations at 1 January 12 750 12 047 1 171 1 132
Extension of coverage (a) 2 261 –––
Service cost 315 252 20 20
Interest cost 864 737 78 83
Plan member contributions 81––
Amendments –90 (4) –
Plan mergers 170 41 ––
Actuarial (gains)/losses 1 215 291 33 –
Acquisitions/disposals (57) (11) (22) (12)
Settlements/curtailments (321) (31) –(3)
Special termination benefits –29 –1
Benefits paid (1 204) (873) (88) (89)
Currency retranslations (786) 177 (176) 39
Benefit obligations at 31 December 15 215 12 750 1 012 1 171
Change in plan assets
Fair value of plan assets at 1 January 13 560 15 401 33
Extension of coverage (a) 2 320 –––
Plan mergers 154 –––
Actual return on plan assets (1 953) (928) (1) –
Acquisitions/(disposals) (10) (11) ––
Settlements (249) (31) ––
Employer contribution/surplus refunds 36 (144) 88 88
Plan member contributions 81––
Benefits paid (1 118) (873) (88) (89)
Currency retranslations (651) 145 –1
Fair value of plan assets at 31 December 12 097 13 560 23
Funded status at 31 December (3 118) 810 (1 010) (1 168)
Unrecognised net transition liability/(asset) (178) (247) –3
Unrecognised net actuarial loss/(gain) 3 285 (1 119) (34) (85)
Unrecognised prior service cost 178 201 15
Other (SFAS 112 liabilities) n/a n/a (30) (39)
Net amount recognised at 31 December 167 (355) (1 073) (1 284)
Amount recognised in the statement of financial position consists of:
Prepaid benefit cost 1 543 813 ––
Accrued benefit liability (1 376) (1 168) (1 069) (1 283)
Additional minimum liability (2 454) (20) ––
Intangible asset 94 4––
Accumulated other comprehensive income 2 360 16 (4) (1)
Net amount recognised at 31 December 167 (355) (1 073) (1 284)
(a) With effect from 1 January 2002 a number of additional pension plans were included in the SFAS 87 valuation exercise. This increases
the overall coverage provided by the key pension plans from 76% to 90%.