SYDNEY PORTS CORPORATION ANNUAL REPORT 12

(g) Fair value of Fund assets
All Fund assets are invested by the SAS Trustee Corporation at arm’s length through independent fund managers.
(h) Actual return on Fund assets
SaSS
$000
SanCS
$000
Year ended 30 June 2012
Actual return on Fund assets
Year ended 30 June 2011
12 (2) 35 45
Actual return on Fund assets 1,426 284 4,104 5,814
(i) Expected rate of return on assets
The expected return on assets assumption is determined by weighting the expected long-term return for each asset class by
the target allocation of assets to each class. The returns used for each class are net of investment tax and investment fees.
(j) Valuation method and principal actuarial assumptions at the statement of financial position date
(i) Valuation method
The Projected Unit Credit (PUC) valuation method was used to determine the present value of the defined benefit
obligations and the related current service costs. This method treats each period of service as giving rise to an additional
unit of benefit entitlement and measures each unit separately to calculate the final obligation.
(ii) Economic assumptions
30 JUne 2012 30 JUne 2011
Discount rate 3.06% pa 5.28% pa
Expected rate of return on assets 8.60% pa 8.60% pa
Salary increase rate (excluding promotional increases) 2.50% pa 3.50% pa
Rate of CPI increase 2.50% pa 2.50% pa
(iii) Demographic assumptions
The demographic assumptions at 30 June 2012 are those that were used in the 2009 triennial actuarial valuation.
The triennial review report is available from the NSW Treasury website.
(k) Funding arrangements for employer contributions
(i) Surplus/deficit
The following is a summary of the 30 June 2012 and 2011 financial position of the Fund calculated in accordance with
AAS 25 Financial Reporting by Superannuation Plans.
SaSS
$000
SanCS
$000
Year ended 30 June 2012
Accrued benefits 16,534 3,301 48,435 68,270
Net market value of Fund assets (15,610) (2,920) (49,677) (68,207)
Net (surplus)/deficit
Year ended 30 June 2011
924 381 (1,242) 63
Accrued benefits 17,076 3,334 46,137 66,547
Net market value of Fund assets (17,343) (3,394) (51,857) (72,594)
Net (surplus) (267) (60) (5,720) (6,047)
(ii) Funding method
The method used to determine the employer contribution recommendations at the last actuarial review was the Aggregate
Funding method. The method adopted affects the timing of the cost to the employer.
Under the Aggregate Funding method, the employer contribution rate is determined so that sufficient assets will be available
to meet benefit payments to existing members, taking into account the current value of assets and future contributions.
Contribution rates are set after discussions between the Corporation, NSW Treasury and the SAS Trustee Corporation.
SSS
$000
SSS
$000
total
$000
total
$000
Sydney PortS CorPoration finanCial rePort 2011/12 73