Virgin Media 2006 Annual Report Download - page 115

VIRGIN MEDIA INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
14. Employee Benefit Plans
Defined Benefit Plans
Certain of our subsidiaries operate defined benefit pension plans in the United Kingdom. The assets of the plans are held
separately from those of ourselves and are invested in specialized portfolios under the management of an investment group. The
pension cost is calculated using the projected unit method. Our policy is to fund amounts to the defined benefit plans necessary to
comply with the funding requirements as prescribed by the laws and regulations in the United Kingdom. Our defined benefit pension
plans use a measurement date of December 31.
We have adopted the provisions of Statement of Financial Accounting Standards No. 158, “Employers’ Accounting for Defined
Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, and 132(R)” ( “SFAS No. 158”
), as of December 31, 2006. In accordance with SFAS 158, our 2005 accounting and related disclosures were not affected by the
adoption of the new standard. The table below summarizes the incremental effects of SFAS No. 158 adoption on the individual line
items in our balance sheet at December 31, 2006 (in millions):
Pre SFAS
No. 158
Adoption
SFAS
No. 158
Adjustment
Post SFAS
No. 158
Adoption
Deferred revenue and other long term liabilities £ 32.3 £ 9.4 £ 41.7
Accumulated other comprehensive income 10.6 9.4 20.0
Obligations and Funded Status
The change in projected benefit obligation was as follows (in millions):
Year ended
December 31,
2006 2005
Benefit obligation at beginning of year £ 334.0 £ 282.8
Service cost 2.5 2.7
Interest cost 15.8 14.5
Members’ contributions 0.6 0.7
Actuarial (gains) losses (5.4) 44.4
Benefits paid (8.7) (7.7)
Plan settlements 1.0 (3.4)
Benefit obligation at end of year £ 339.8 £ 334.0
F−35
Source: VIRGIN MEDIA INVESTM, 10−K, March 01, 2007