Report 2010 - Italcementi Group

deferred tax assets are reviewed at the end of every reporting period and reduced to the extent that
sufficient taxable income is no longer likely to be available in the future against which the assets can be
used in full or in part.
Deferred tax assets and liabilities are determined at tax rates expected to apply when the deferred tax asset
(liability) is realized (settled), based on rates that have been enacted or substantially enacted at the balance
sheet date.
Taxes relating to items recognized directly in equity are recognized in equity, not income.
1.17. Employee benefits
The Group operates pension plans, post-employment medical benefit plans and leaving entitlement provisions.
It also has other commitments, in the form of bonuses payable to employees on the basis of length of service
in some Group companies (“Other long-term benefits”).
Defined contribution plans
Defined contribution plans are structured post-employment benefit programs where the Group pays fixed
contributions to an insurance company or pension fund and will have no legal or constructive obligation to pay
further contributions if the fund does not dispose of sufficient assets to pay all the employee benefits accruing
in respect of services rendered during the current year and in previous years. These contributions are paid in
exchange for the services rendered by employees and recognized as expense as incurred.
Defined benefit plans
Defined benefit plans are structured post-employment benefit programs that constitute a future obligation for
the Group. In substance, the company assumes the actuarial and investment risks of the plan. In accordance
with IAS 19, the Group uses the unitary credit projection method to determine the present value of obligations
and the related benefit cost of current services rendered.
These actuarial calculations require use of consistent and objective actuarial assumptions about demographic
variables (mortality rate, personnel turnover rate) and financial variables (discount rate, future increments on
salaries and medical benefits).
When a defined benefit plan is funded in full or in part by contributions paid to a fund that is a separate legal
entity or to an insurance company, the assets servicing the plan are estimated at fair value.
Benefit obligations are therefore recognized net of the fair value of the plan assets that will be used to settle
the obligations.
Leaving entitlements provided by the Italian companies (TFR, trattamento di fine rapporto) are treated in the
same way as benefit obligations arising from defined benefit plans.
Plans for termination of employment
Plans for termination of employment include provisions for restructuring costs recognized when the Group
company in question has approved a detailed formal plan that has already been implemented or notified to the
third parties concerned.
Treatment of actuarial gains and losses
Actuarial gains and losses on post-employment defined benefit plans may arise as a result of changes in the
actuarial assumptions used in two consecutive periods or as a result of changes in the obligation value or in
the fair value of any plan asset in respect of the actuarial assumptions used at the beginning of the period.
The Group uses the corridor method whereby actuarial gains and losses are recognized as income or expense
when their unrecognized cumulative net value, for each plan, at the end of the previous period exceeds 10% of
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