Vtech 2012 Annual Report Download - page 58

56 VTech Holdings Ltd Annual Report 2012
Notes to the Financial Statements
16 Pension Schemes
The Group operated a defined benefit scheme and defined
contribution schemes in Hong Kong and overseas. 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$7.7 million (2011: US$6.1 million) and
US$0.6 million (2011: US$0.5 million) respectively.
For the defined benefit scheme (the “Scheme”) operated for Hong
Kong employees, contributions made by the Group during the year
were calculated based on advice from Watson Wyatt Hong Kong
Limited, a Towers Watson company (“Towers Watson”),
independent actuaries and consultants. The Scheme is valued
annually. The latest actuarial valuation was completed by Towers
Watson as at 31 March 2012 using the projected unit credit method.
For the defined benefit scheme, the amounts recognised in the
consolidated balance sheet are as follows:
2012 2011
Note US$ million US$ million
Fair value of Scheme assets 22.9 22.7
Present value of funded
defined benefit obligations (31.1) (23.8)
Unrecognised actuarial losses 10.6 3.1
Assets recognised in the
consolidated balance
sheet 12 2.4 2.0
The amounts recognised in
the consolidated income
statement are as follows:
Current service cost 1.6 1.6
Interest cost 0.7 0.7
Expected return on plan assets (1.5) (1.4)
Net actuarial losses recognised
in the year 0.1 0.1
Expenses recognised in
the consolidated
income statement 20.9 1.0
The actual return on plan
assets was as follows:
Expected return on plan assets 1.5 1.4
Actuarial (losses)/gains
on plan assets (2.3) 0.7
Actual return on plan assets (0.8) 2.1
Movement in the assets
recognised
in the consolidated
balance sheet:
At 1 April 2.0 1.7
Expenses recognised in the
consolidated income
statement (0.9) (1.0)
Contributions paid 1.3 1.3
At 31 March 2.4 2.0
2012 2011
US$ million US$ million
Movement in fair value of
Scheme assets:
At 1 April 22.7 20.0
Expected return on plan assets 1.5 1.4
Actual Group’s contributions 1.3 1.3
Actual benefit paid (0.3) (0.7)
Actuarial (losses)/gains
on plan assets (2.3) 0.7
At 31 March 22.9 22.7
Movement in present value
of funded defined
benefit obligations:
At 1 April 23.8 22.4
Interest cost 0.7 0.7
Current service cost 1.6 1.6
Actual benefits paid (0.3) (0.7)
Actuarial losses/(gains) 5.3 (0.2)
At 31 March 31.1 23.8
2012 2011 2010 2009 2008
US$ million US$ million US$ million US$ million US$ million
Historical
information
Present value of
funded defined
benefit
obligations 31.1 23.8 22.4 24.2 21.3
Fair value of
Scheme assets (22.9) (22.7) (20.0) (13.7) (18.7)
Deficit in the plan 8.2 1.1 2.4 10.5 2.6
Experience gains on
Scheme liabilities (0.1) (0.1) (1.0) (0.6) (0.1)
Experience losses/
(gains) on
Scheme assets 2.3 (0.7) (4.4) 6.4 0.2
2012 2011
Scheme assets consist of
the following:
Equities 69.4% 70.8%
Bonds 26.7% 23.4%
Cash and others 3.9% 5.8%
100.0% 100.0%
The principal actuarial assumptions
used as at 31 March 2012
(expressed as weighted average)
are as follows:
Discount rate 1.3% 3.0%
Expected rate of return
on plan assets 7.0% 7.0%
Future salary increases 5.0% 5.0%