HSBC 2005 Annual Report Download - page 268

HSBC HOLDINGS PLC
Notes on the Financial Statements (continued)
266
Total expense recognised in the income statement in ‘Employee compensation and benefits’
2005 2004
HSBC Bank
(UK) Pension
Scheme
Other
plans
HSBC Bank
(UK) Pension
Scheme
Other
plans
US$m US$m US$m US$m
Current service cost ..................................................... 383 283 348 257
Interest cost ................................................................. 981 333 921 326
Expected return on plan assets .................................... (954) (401) (927) (382)
Past service cost .......................................................... –(3)–(8)
(Gains)/losses on curtailments ..................................... –(4)242 (17)
Total expense ............................................................... 410 208 584 176
Summary
2005 2004
HSBC Bank
(UK) Pension
Scheme
Other
plans
HSBC Bank
(UK) Pension
Scheme
Other
plans
US$m US$m US$m US$m
Defined benefit obligation ........................................... (20,587) (7,102) (19,988) (6,501)
Fair value of plan assets .............................................. 17,396 6,356 15,105 5,823
Net deficit .................................................................... (3,191) (746) (4,883) (678)
Experience gains/(losses) on plan liabilities ................ 70 (113) 401 (42)
Experience gains on plan assets .................................. 1,623 78 506 3
Losses from changes in actuarial assumptions ............ (2,038) (393) (1,357) (243)
Total net actuarial losses ............................................. (345) (428) (450) (282)
Actuarial gains and losses represent experience adjustments on plan assets and liabilities as well as adjustments
arising from changes in actuarial assumptions. Total net actuarial losses recognised in equity at 31 December 2005
were US$1,505 million.
The total effect of the limit on plan surpluses recognised in equity together with net actuarial losses in 2005 was a
US$4 million gain (2004: US$4 million loss).
Post-employment healthcare benefits plans
2005 2004
Expected rates
of return Value
Expected rates
of return Value
%US$m
%US$m
Equities ....................................................................... 12.0 32 13.5 62
Bonds .......................................................................... 8.5 75 9.25 17
Fair value of plan assets .............................................. 107 79
Present value of funded obligations ............................. (178) (143)
Present value of unfunded obligations ......................... (826) (839)
Defined benefit obligation ........................................... (1,004) (982)
Unrecognised past service cost .................................... (31) –
Net liability .................................................................. (928) (903)