Annual report 2015

NOTE 15

PENSION COSTS AND LIABILITIES

FERD'S PENSION PLANS

Ferd has established pension schemes in accordance with Norwegian legislation. The employees participate in a defined contriution plan for salaries below 12G.

For salaries exceeding 12 G, Ferd has established a pension scheme implying that the employees earn a pension right each year. The scheme was closed for new hires when established. The right comprises a share of the salary in excess of 12 G together with a return component depending on the employee's chosen risk profile. The pension plan has many similarities with a contribution scheme, but as Ferd is not making current payments to a fund, but has elected to take the risk of return itself, the scheme shall be classified as a benefit scheme for accounting purposes. Ferd has recognised the obligation as a pension liabiity and is expensing the current deposits and the current return as incurred.

In addition, Group management has an early retirement pension scheme giving them the opportunity to retire at 65 years. This is also a benefit scheme.

Financial assumptions at 31 December

Discount interest rate

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

 

Fair value of pension funds

Total defined benefit obligation recognised in the balance sheet at 31 Dec.

Movement in liabilities for defined benefit pensions plans

NOK 1 000

Liabilities for defined benefit pension plans at 1 Jan.

Present value of current year's pension earnings

Interest expense on pension liabilities

Estimate deviation on pension liabilities

Benefits paid

Liabilities for defined benefit pension plans at 31 Dec.

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

NOK 1 000

Fair value of pension assets at 1 January

Benefits paid

Fair value of pension assets at 31 December

Estimate deviation recognised in total comprehensive income

NOK 1 000

Estimate deviation on the pension obligation (benefit schemes) of the year

Net estimate deviation for benefit schemes recognised in comprehensive income

Pension costs recognised in the income statement

NOK 1 000

Present value of this year's pension earnings

Pension costs on contribution schemes

Total pension costs recognised in the income statement as salary expenses

Interest expense on the pension liability

Total pension costs recognised in the income statement as interest expenses