ICICI Bank 2003 Annual Report Download - page 151

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F87
The actuarial assumptions used in accounting for the gratuity plan are given below:
As of March 31,
2002 2003
Discount rate 10% 8%
Rate of increase in the compensation levels 9% 7%
Rate of return on plan assets 9.5% 7.5%
As of March31, 2003, of the total plan assets, Rs. 46million (2002: Rs. 3million) has been invested in debt
securities of the Company.
Pension
The Company provides for pension, a deferred retirement plan covering certain employees. The plan provides for a
pension payment on a monthly basis to these employees on their retirement based on the respective employee’s
salary and years of employment with the Company. Employees covered by the pension plan are not eligible for
benefits under the provident fund plan, a defined contribution plan. The pension plan is the continuation of the
acquiree’s plan and hence there are no comparatives for the current year.
The pension plan is funded through periodic contributions to a fund set-up by the Company and administrated by
a Board of Trustees. Such contributions are actuarially determined.
The following table sets forth the funded status of the plan and the amounts recognized in the financial statements.
(Rs. in millions)
As of March 31, 2003
Change in benefit obligations
Projected benefit obligations at beginning of the year 913
Service cost 22
Interest cost 89
Expected benefits payments (42)
Actuarial (gain)/loss on obligations (129)
Projected benefit obligations at the end of the year. 853
Change in plan assets
Fair value of plan assets at beginning of the year 914
Expected return on plan assets 86
Employer contributions 16
(Gain)/loss on plan assets 166
Benefits paid (26)
Plan assets at the end of the year 1,156
Net prepaid benefit 303
The components of the net pension cost are set out below:
(Rs. in millions)
Year ended March 31, 2003
Service cost 22
Interest cost 89
Expected return on assets (86)
Actuarial (gain)/loss —
Net pension cost 25
Continued
notes to the consolidated financial statements