Virgin Media 2010 Annual Report Download - page 135

VIRGIN MEDIA INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Note 12—Employee Benefit Plans (continued)
Obligations and Funded Status
The change in projected benefit obligation was as follows (in millions):
Year ended December 31,
2010 2009
Benefit obligation at beginning of year ............... £377.8 £307.8
Service cost .................................... 1.6 1.2
Interest cost .................................... 21.4 17.4
Members' contributions ........................... 0.3 0.3
Actuarial loss ................................... 2.3 66.4
Benefits paid ................................... (13.4) (15.3)
Benefit obligation at end of year .................... £390.0 £377.8
In July 2010, the U.K. government announced that it will use the Consumer Price Index (CPI) rather than
the Retail Price Index (RPI) for the purpose of determining statutory minimum pension increases for private
sector pension schemes. The scheme rules of our defined benefit pension plans specify that pensions for
members in deferment will increase in line with statutory increases. The reduction in the projected benefit
obligation attributable to the change in the basis used to assume minimum pension increases from CPI to RPI for
members in deferment has been included as a component of the actuarial loss (gain) in other comprehensive
income.
The change in plan assets was as follows (in millions):
Year ended December 31,
2010 2009
Fair value of plan assets at beginning of year .......... £306.2 £273.9
Actual return on plan assets ........................ 41.0 33.9
Employer contributions ........................... 16.9 13.4
Employee contributions ........................... 0.3 0.3
Benefits paid ................................... (13.4) (15.3)
Fair value of plan assets at end of year ............... £351.0 £306.2
The funded status as of December 31, 2010 and 2009 was as follows (in millions):
Year ended December 31,
2010 2009
Projected benefit obligation ........................ £390.0 £377.8
Plan assets ..................................... 351.0 306.2
Funded status ................................... (39.0) (71.6)
Non-current liability .............................. £(39.0) £ (71.6)
F-40