Vtech 2011 Annual Report Download - page 53

VTech Holdings Ltd Annual Report 2011 51
16 Pension Schemes
The Group operated a defined benefit scheme and a defined
contribution scheme in Hong Kong. The defined contribution
scheme operated in Hong Kong complied with the requirements
under the Mandatory Provident Fund (“MPF”) Ordinance. For the
defined contribution schemes operated for overseas employees
and Hong Kong employees under the MPF Ordinance, the
retirement benefit costs expensed in the consolidated income
statement amounted to US$6.1 million (2010: US$4.9 million)
and US$0.5 million (2010: US$0.5 million) respectively. For the
defined benefit scheme (the “Scheme”) operated for Hong Kong
employees, contributions made by the Group during the year
were calculated based on advice from Watson Wyatt Hong
Kong Limited, a Towers Watson company (“Towers Watson”),
independent actuaries and consultants. The Scheme is valued
annually. The latest actuarial valuation was completed by Towers
Watson as at 31 March 2011 using the projected unit credit
method.
For the defined benefit scheme, the amounts recognised in the
consolidated balance sheet are as follows:
Note
2011
US$ million
2010
US$ million
Fair value of Scheme assets
Present value of funded
defined benefit obligations
22.7 20.0
(23.8) (22.4)
Unrecognised actuarial losses 3.1 4.1
Assets recognised in the
consolidated balance
sheet 12 2.0 1.7
The amounts recognised in
the consolidated income
statement are as follows:
Current service cost 1.6 1.9
Interest cost 0.7 0.5
Expected return on plan assets (1.4) (1.0)
Net actuarial losses
recognised in the year 0.1 0.7
Expenses recognised in
the consolidated
income statement 21.0 2.1
The actual return on plan
assets was as follows:
Expected return on plan assets
Actuarial gains on plan assets
1.4 1.0
0.7 4.4
Actual return on
plan assets 2.1 5.4
Movement in the assets
recognised in the
consolidated balance
sheet:
At 1 April 1.7 2.5
Expenses recognised in the
consolidated income
statement (1.0) (2.1)
Contributions paid 1.3 1.2
Insurance proceeds –0.1
At 31 March 2.0 1.7
2011
US$ million
2010
US$ million
Movement in fair value of
Scheme assets:
At 1 April 20.0 13.7
Expected return on
plan assets 1.4 1.0
Actual Group’s contributions 1.3 1.2
Actual benefit paid (0.7) (0.4)
Actuarial gains on
plan assets 0.7 4.4
Insurance proceeds –0.1
At 31 March 22.7 20.0
Movement in present
value of funded defined
benefit obligations:
At 1 April 22.4 24.2
Interest cost 0.7 0.5
Current service cost 1.6 1.9
Actual benefits paid (0.7) (0.4)
Actuarial gains (0.2) (3.8)
At 31 March 23.8 22.4
2011
US$ million
2010
US$ million
2009
US$ million
2008
US$ million
2007
US$ million
Historical information
Present value of funded
defined benefit obligations 23.8 22.4 24.2 21.3 16.3
Fair value of Scheme assets (22.7) (20.0) (13.7) (18.7) (17.2)
Deficit/(surplus) in the plan 1.1 2.4 10.5 2.6 (0.9)
Experience gains on Scheme
liabilities (0.1) (1.0) (0.6) (0.1) –
Experience (gains)/losses on
Scheme assets (0.7) (4.4) 6.4 0.2 (1.4)
2011 2010
Scheme assets consist of
the following:
Equities 70.8% 65.4%
Bonds 23.4% 21.6%
Cash and others 5.8% 13.0%
100.0% 100.0%
The principal actuarial
assumptions used as at
31 March 2011 (expressed
as weighted average) are
as follows:
Discount rate 3.0% 3.0%
Expected rate of return
on plan assets 7.0% 7.0%
Future salary increases 5.0% 5.0%