Download the Annual report 2011 - Unisa

Valuation assumptions
UNISA ANNUAL REPORT 2011
| 99 |
2011 2010
Discount rate 9.0% 8.5%
Healthcare inflation costs 8.0% 7.5%
Real discount rate 0.93% 0.93%
Sensitivity analysis
Assumptions
Variation
Real discount rate -100 basis points
Current
Obligations
Revised
Obligations
R’000 R’000
% Change
Active members 126 521 150 884 19.3%
Continuation members 436 749 481 353 10.2%
Real discount rate +100 basis points
563 270 632 237
Active members 126 521 107 258 (15.2%)
Continuation members 436 749 399 127 (8.6%)
563 270 506 385
Medical inflation rate 1% increase 563 270 626 646 11.3%
Medical cost trends
12.2 Defined benefit pension fund asset
1% decrease 563 270 509 336 (9.6%)
Variation
Current
Obligations
Service costs
plus interest
R’000 R’000
% Change
1% increase 563 270 62 043 12.3%
1% decrease 563 270 49 481 (10.4%)
The assets of the Unisa Retirement Fund (“Unisarf”, or the “Fund”) are held independently of the University of
South Africa’s assets in a separate trustee-administered fund.
The Fund is valued by independent actuaries every three years, in line with the statutory requirement in terms
of Section 16(8) of the Pension Funds Act. The last statutory valuation was undertaken with an effective date
of 31 December 2008 and the Valuator reported that the Fund was in a sound financial position at that date.
The next statutory valuation is to be performed with an effective date of 31 December 2014.
A valuation has been carried out as at 31 December 2011 specifically for the purposes of the University’s
AC116 (IAS19) disclosure requirement. The purpose of this valuation is to quantify the net pension asset or
liability in respect of the defined benefit element of Unisarf for recognition in terms of the AC116 (IAS19)
accounting standard. The movement in the value in the Fund’s defined benefit assets and liabilities has been
shown below.