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200
Sixty-Seventh Annual Report 2011-2012
34 (a) Defined benefit plans / Long term compensated absences
Gratuity, Superannuation and
Compensated Absences
Post-retirement Medicare
BKY / PSY
scheme
As at / for the year ended on March 31,
2012
2011 2010 2009 2008
2012
2011 2010 2009 2008
2012
2011 2010 2009 2008
i
Components of employer expense
Current service cost
46.66
35.79 31.60 31.60 26.75
27.95
22.29 18.66 18.31 15.22
4.22
3.67 3.27 2.79 2.93
Interest cost
55.26
47.96 44.96 43.98 40.55
17.83
14.07 12.16 12.53 11.22
8.14
7.23 7.05 5.80 5.03
Expected return on plan assets
(49.74)
(44.70) (42.18) (38.49) (36.09)
-
-
-
-
-
-
-
-
-
-
Past service cost
-
0.07 0.57 3.07
-
-
-
-
-
-
-
-
-
-
-
Actuarial losses/(gains)
21.81
59.49 50.90 (5.57) 52.77
23.23
40.45 29.16 (8.89) 18.34
(6.02)
3.80 (0.14) 10.57 5.74
Total expense recognised in the
Profit and Loss Statement
in Note 26(b), page 194 :
73.99
98.61 85.85 34.59 83.98
69.01
76.81 59.98 21.95 44.78
6.34
14.70 10.18 19.16 13.70
(b) & (c)
(a)
(c)
ii
Actual contribution and benefit
payments
Actual benefit payments
56.26
64.43 63.95 67.01 68.43
32.26
33.00 23.60 29.55 28.77
3.90
4.13 4.38 4.51 4.65
Actual contributions
67.57
84.77 86.78 37.10 104.37
32.26
33.00 23.60 29.55 28.77
3.90
4.13 4.38 4.51 4.65
iii Net asset/(liability) recognised in
balance sheet
Present value of Defined Benefit Obligation
753.37
688.63 607.16 574.18 558.32
262.73
225.76 181.95 154.81 162.41
100.18
97.74 87.17 85.18 70.53
Fair value of plan assets
674.01
616.11 548.41 515.83 497.46
-
-
-
-
-
-
-
-
-
-
Net asset/(liability) recognised in
balance sheet
(79.36)
(72.52) (58.75) (58.35) (60.86)
(262.73)
(225.76) (181.95) (154.81) (162.41)
(100.18)
(97.74) (87.17) (85.18) (70.53)
Experience adjustment on plan
liabilities
(7.73) (37.41)
(4.41) (42.32)
39.33
N/A N/A N/A N/A N/A
(2.83)
5.32 0.39 4.87
-
Experience adjustment on plan
assets
(3.16)
2.72 (5.11)
10.60 (8.08)
N/A N/A N/A N/A N/A
-
-
-
-
-
iv Change in Defined Benefit Obligations
(DBO)
Present value of DBO at beginning of year
688.63
607.16 574.18 558.32 513.74
225.76
181.95 154.81 162.41 146.40
97.74
87.17 85.18 70.53 61.48
Liability on acquisitions
0.43
-
-
-
0.73
0.22
-
-
-
-
-
-
-
-
-
Current service cost
46.66
35.79 31.60 31.60 26.75
27.95
22.29 18.66 18.31 15.22
4.22
3.67 3.27 2.79 2.93
Interest cost
55.26
47.96 44.96 43.98 40.55
17.83
14.07 12.16 12.53 11.22
8.14
7.23 7.05 5.80 5.03
Plan amendments
-
-
0.65 3.07
-
-
-
-
-
-
-
-
-
-
-
Actuarial (gains)/ losses
18.65
62.15 46.15 4.22 44.98
23.23
40.45 29.16 (8.89) 18.34
(6.02)
3.80 (0.14) 10.57 5.74
Benefits paid
(56.26)
(64.43) (63.95) (67.01) (68.43)
(32.26)
(33.00) (23.60) (29.55) (28.77)
(3.90)
(4.13) (4.38) (4.51) (4.65)
Sale of stake in subsidiary
-
- (26.43)
-
-
-
- (9.24)
-
-
-
- (3.81)
-
-
Present value of DBO at the end of
year
753.37
688.63 607.16 574.18 558.32
262.73
225.76 181.95 154.81 162.41
100.18
97.74 87.17 85.18 70.53
v Change in fair value of assets
Plan assets at beginning of year
616.11
548.41 515.83 497.46 433.21
-
-
-
-
-
-
-
-
-
-
Actual return on plan assets
46.59
47.36 37.43 48.28 28.31
-
-
-
-
-
-
-
-
-
-
Actual Company contributions
67.57
84.77 86.78 37.10 104.37
32.26
33.00 23.60 29.55 28.77
3.90
4.13 4.38 4.51 4.65
Benefits paid
(56.26)
(64.43) (63.95) (67.01) (68.43)
(32.26)
(33.00) (23.60) (29.55) (28.77)
(3.90)
(4.13) (4.38) (4.51) (4.65)
Sale of stake in subsidiary
-
- (27.68)
-
-
-
-
-
-
-
-
-
-
-
Plan assets at the end of year
674.01
616.11 548.41 515.83 497.46
-
-
-
-
-
-
-
-
-
-
vi Actuarial assumptions
Discount rate (%)
6.75-8.50
6.75-8.50 6.75-8.50 6.75-8.50 7.75-8.50
8.50
8.50 8.50 8.50 8.50
8.50
8.50 8.50 8.50 8.50
Expected return on plan assets (%)
8.00
8.00 8.00 8.00 8.00
N/A
N/A N/A N/A N/A
N/A
N/A N/A N/A N/A
Medical cost inflation (%)
N/A
N/A N/A N/A N/A
N/A
N/A N/A N/A N/A
4.00
4.00 4.00 4.00 4.00
vii The major categories of plan assets
as percentage to total plan assets
Debt securities
77%
7 5% 7 6% 7 8% 6 9%
N/A
N/A N/A N/A N/A
N/A
N/A N/A N/A N/A
Balances with banks
23%
2 5% 2 4% 2 2% 3 1%
N/A
N/A N/A N/A N/A
N/A
N/A N/A N/A N/A
viii
Effect of one percentage point
One percentage point increase in
One percentage point decrease in
change in assumed medical
medical inflation rate
medical inflation rate
inflation rate
2012
2011 2010 2009 2008
2012
2011 2010 2009 2008
Revised DBO
108.44
104.57 100.15 93.68 72.10
81.62
88.49 82.98 77.74 64.68
Revised service cost
4.88
4.30 3.78 3.21 3.12
3.04
3.16 2.80 2.50 2.35
Revised interest cost
8.85
7.97 7.78 5.96 5.54
6.81
6.59 6.42 5.30 4.54
(a)
Definedcontributionplans-
TheCompany’s contribution todefinedcontributionplanaggregated
`
250.60crores
(2010-11
`
193.23crores) for theyear endedMarch31,2012hasbeen recognised in theProfit andLoss Statement
innote26 (b) onpage194.
(b)
Theexpectedrateof returnonplanassets isbasedonmarket expectation, at thebeginningof theyear, for returnsover theentire lifeof the relatedobligation.
(c)
Theassumptionof futuresalary increases, considered inactuarial valuation, takeaccountof inflation, seniority, promotionandother relevant factors, suchas supplyanddemand inthe
employmentmarket.
(d)
TheCompanyexpects tocontribute
`
91.04crores
to the fundedpensionplans in theyear 2012-2013.
NOTESFORMINGPARTOFCONSOLIDATEDFINANCIALSTATEMENTS
(
`
in crores)