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118 Unilever Annual Report and Accounts 2005
Notes to the consolidated accounts
Unilever Group
22 Pensions and similar obligations (continued)
Reconciliation of change in assets and liabilities
Movements in assets and liabilities during the year:
€ million € million € million € million
Assets Assets Liabilities Liabilities
2005 2004 2005 2004
1 January 13 419 12 819 (18 773) (17 880)
Acquisitions/disposals (3) –18 (6)
Current service cost ––(367) (344)
Employee contributions 19 32 ––
Special termination benefits ––(79) (135)
Past service costs ––(13) (13)
Settlements/curtailments (10) (23) 105 85
Other finance income 931 918 ––
Other finance cost ––(986) (976)
Actuarial gain/(loss) 1 592 369 (1 679) (1 094)
Employer contributions 836 786 ––
Benefit payments (1 247) (1 223) 1 247 1 223
Reclassification of benefits(b) 39 (166) (140) 166
Currency retranslation 430 (93) (779) 201
31 December 16 006 13 419 (21 446) (18 773)
(b) During 2004 some plans changed from defined benefit to defined contribution. During 2005 certain obligations were reclassified as
employee benefit obligations.
History of experience gains and losses
2005 2004
Actual return less expected return on plan assets (€ million) 1 592 369
As % of plan assets at beginning of year (%) 12 3
Experience gains/(losses) on plan liabilities (€ million) 27 (47)
As % of present value of plan liabilities at beginning of year (%) ––
Changes in actuarial assumptions underlying the present value of the
pension benefit and other benefit plan liabilities (€ million) (1 706) (1 047)
As % of present value of plan liabilities at beginning of year (%) (9) (6)
Total actuarial gain/(loss) (€ million) (87) (725)
As % of present value of plan liabilities at beginning of year (%) –(4)
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 manner similar to that used under IAS 19. The accounting methodology however is not the same as under IAS 19, since under
US GAAP all costs are recognised in operating profit and certain cost items are amortised in the income statement rather than recognised
immediately.
The disclosures below show the benefit obligations, assets, funded status and balance sheet impact, as well as the periodic expense, cash flows
and related economic assumptions associated with the defined benefit pension plans and other post-employment benefit plans as computed in
accordance with FAS 87 and FAS 106.
Measurement dates
All plan assets are valued at fair value at the balance sheet date. Liabilities in respect of the most important pension plans, comprising
approximately 75% of the pension liabilities, are subject to actuarial valuations every year. The valuations use membership data for the current
year with the liability projected forward to the balance sheet date. Valuations of all other plans are carried out every three years and in the case
of the other principal pension plans, comprising approximately a further 15% of the liabilities, the valuations are updated each year.