Lenovo 2014 Annual Report Download - page 118
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116 Lenovo Group Limited 2013/14 Annual Report
DIRECTORS’ REPORT
RETIREMENT SCHEME ARRANGEMENTS (continued)
DEFINED BENEFIT PENSIONS PLANS (continued)
Japan – Pension Plan (continued)
The principal results of the most recent actuarial valuation of the plan at March 31, 2014 were the following:
• The actuarial valuation was prepared by JP Actuary Consulting Co., Ltd. The actuaries involved are fully qualified
under the requirements of Japanese law.
• The actuarial method used was the Projected Unit Credit Cost method and the principal actuarial assumptions were:
– Discount rate: 1.75%
– Expected return on plan assets: 1.75%
– Future salary increases: Age-group based
• The plan was 90% funded at the actuarial valuation date.
• There was a net liability of Yen 1,092,765,330 under this plan at the actuarial valuation date.
Germany – Pension Plan
The Company operates a hybrid plan that provides a defined contribution for some participants and a final pay defined
benefit for other participants, depending on which former IBM plan they were in.
Employees hired by IBM before January 1, 1992 have a defined benefit based on a final pay formula. Employees hired
from 1992 to 1999 have a combination of a defined benefit based on a final pay formula and a defined contribution
plan with employee required contributions of 7% of pay above the social security ceiling and a 100% company match.
Employees hired in or after 2000 have a combination of a cash balance plan with an employer contribution of 2.95%
of pay below the social security ceiling, and a voluntary defined contribution plan where employees can contribute
specific amounts through salary sacrifice.
The plan is partially funded by Company and employee contributions to an insured support fund with DBV-Winterthur
up to the maximum tax-deductible limits. In line with standard practice in Germany, the remainder is unfunded (book
reserve).
For the year ended March 31, 2014, an amount of EUROS 1,214,920 was charged to the income statement with
respect to this plan.
The principal results of the most actuarial valuation of the plan at March 31, 2014 were the following:
• The actuarial valuation was prepared by Kern, Mauch & Kollegen. The actuaries involved are fully qualified under
German law.
• The actuarial method used was the Projected Unit Credit Cost method and the principal actuarial assumptions were:
– Discount rate: 2.75%
– Future salary increases: Age-group based
– Future pension increases: 1.75%
• The plan was 68% funded at the actuarial valuation date.
• There was a net liability of EUROS 11,414,676 under this plan at the actuarial valuation date.