Aviva 2007 Annual Report Download - page 201
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45 – Provisions
This note details the non-insurance provisions that the Group holds, and shows the movements in these during
the year.
(a) Carrying amounts
2007 2006
£m £m
Deficits in the staff pension schemes (note 46(e)(vii)) 205 1,029
Other obligations to staff pension schemes – insurance policies issued by Group companies (note 38a) 1,025 1,086
Total IAS 19 obligations to staff pension schemes 1,230 2,115
Restructuring provision 136 234
Other provisions 571 501
Total 1,937 2,850
Of the total, £1,277 million (2006: £2,262 million) is expected to be settled more than one year after the balance sheet
date.
(b) Movements during the year on restructuring and other provisions
Restructuring Other
provision provisions Total
£m £m £m
At 1 January 2007 234 501 735
Additional provisions 198 174 372
Unused amounts reversed – (11) (11)
Change in the discounted amount arising from passage of time –55
Charge to income statement 198 168 366
Utilised during the year (300) (101) (401)
Acquisition of subsidiaries –11
Exchange differences 336
At 31 December 2007 135 572 707
Other provisions comprise many small provisions throughout the Group for obligations such as costs of compensation,
litigation, staff entitlements and reorganisation.
46 – Pension obligations
This note describes the Group’s pension arrangements for its employees and explains how our obligations to these
schemes are calculated.
(a) Introduction
The Group operates a large number of defined benefit and defined contribution pension schemes around the world.
The only material defined benefit schemes are in the UK, the Netherlands, Canada and Ireland and, of these, the main
UK scheme is by far the largest.
The assets of the main UK, Irish and Canadian schemes are held in separate trustee-administered funds to meet long-term
pension liabilities to past and present employees. In the Netherlands, the main scheme is held in a separate foundation
which invests in the life funds of the Group. In all schemes, the appointment of trustees of the funds is determined by
their trust documentation, and they are required to act in the best interests of the schemes’ beneficiaries. The long-term
investment objectives of the trustees and the employers are to limit the risk of the assets failing to meet the liabilities of
the schemes over the long term, and to maximise returns consistent with an acceptable level of risk so as to control the
long-term costs of these schemes.
An actuarial report has been submitted for each of the defined benefit schemes within the last three years, using
appropriate methods for the respective countries on local funding bases.
Aviva plc
Annual Report and
Accounts 2007
197
Financial
statements