2012 Annual report

NOTE 15

PENSION COSTS AND LIABILITIES

FERD'S PENSION PLANS

Ferd has established pension schemes in accordance with Norwegian legislation. The employees participate in defined benefit plans complying with the requirements of mandatory occupational pension.

Defined benefit plans

Defined benefit pension plans give the employees the right to determined future pension benefits. Ferd's net obligation reagarding these pension schemes is calculated separately for each scheme. The obligation is an estimate of future benefits earned by the employees, based on the number of service years and the salary level at the age of retirement. The benefits are disounted to present value, and the recognised obligation is reduced by the fair value of the pension funds for funds based pension schemes. Changes in assumptions, total number of members and deviations between estimated and actual salary increases and return on funds result in actuarial gains and losses. Such gains and losses are recognised in total comprehensive income.

The defined benefit plans comprise collective schemes and some additional arrangements including early retirement pension for Group mnagement. Until 2012, Ferd has also had a benefit plan for employees with a pension pension exceeding 12 G, but this scheme was replaced by a contribution plan at the end of 2012. The plan change has been recognised in the income statement.

Financial assumptions at 31 December

Discount rate

Expected return from pension assets

Expected wage growth

Future expected pension regulation

Expected regulation of base amount (G)

DEFINED BENEFIT PLANS

Specification of the recognised liability

NOK 1 000

Present value of unfunded pension liabilities

 

Present value of wholly or partly funded obligations

Total present value of defined benefit obligations

 

Fair value of pension assets

Total defined benefit obligation recognised in the balance sheet

Movement in the liability for defined benefit pension plans

NOK 1 000

Liability for defined benefit pension plans at 1 January

Present value of the pension earnings of the year

Interest expense on the pension liability

Actuarial gains/losses on the pension liability

Plan changes

Benefits paid

Liability for defined benefit pension plans at 31 December

Movement in fair value of pension assets for defined benefit pension plans

NOK 1 000

Fair value of pension assets at 1 January

Expected return from pension assets

Actuarial gains/losses on pension funds

Contribution from employer

Administration expenses

Benefits paid

Fair value of pension assets at 31 December

Pension assets include the following

NOK 1 000

Managed by insurance companies

Total pension assets

Pension costs recognised in the income statement

NOK 1 000

Present value of this year's pension earnings

Interest expense on the pension liability

Plan changes

Administration expenses

Expected return from pension assets

Total pension costs recognised in the income statement