2012 Annual Report - Italcementi Group

2012 Annual Report
Presentation 4
General information 14
Annual Report Consolidated Annual Report Directors’ report 30
Sustainability disclosure Italcementi S.p.A. Annual Report Consolidated financial statements 63
Extraordinary session 351
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 unit credit projection method to determine the present value of obligations and
the related current service cost.
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 plan assets 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.
Termination benefits
Termination benefits 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.
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
the greater of the defined benefit obligation or the fair value of plan assets at that date. These gains or losses
are taken to profit or loss over the estimated average residual working life of the employees participating in the
plans.
Actuarial gains and losses relating to “Other long-term benefits” (service medals, length of service benefits)
and to early retirement benefits are recognized as income or expense immediately.
Past service cost
Changes in liabilities resulting from a change to an existing defined benefit plan are recognized as expense on
a straight-line basis over an average period until the benefits have vested. Costs for benefits that vest
immediately upon changes to a plan are recognized as expense as incurred.
Curtailment and settlement
Gains or losses on the curtailment or settlement of a defined benefit plan are recognized as income or expense
when the curtailment or settlement occurs. The gain or loss includes changes in the present value of the
obligation, changes in the fair value of plan assets, actuarial gains or losses and past service costs not
previously accounted for.
At the curtailment or settlement date, the obligation and the fair value of the plan assets are re-measured using
current actuarial assumptions.
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