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Kabel Deutschland GmbH
Notes to the consolidated financial statements
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determined for the CGU to which the asset belongs.
2.9.2 Reversal of Impairment Loss
Impairment losses on assets are reversed when assumptions relating to the
recoverable amount of the assets change in a way that the expected recoverable amount is
increased. Impairment losses are only reversed up to the carrying amount of the asset which
would have been recorded if the asset had been subject to standard depreciation without
impairment.
2.10 Trade Payables and Other Liabilities
Trade payables and other liabilities are recognized at amortized cost.
2.11 Employee Benefits
2.11.1 Defined Benefit Plan
Under the Group’s pension plans, Group Entities provide employees post-employment
benefits under a defined benefit plan. The benefits are unfunded.
The present value of future claims of participants is estimated using actuarial methods
based on the amount of future benefit that employees have earned in return for their service in
the current and prior periods. The liabilities to be recognized in the consolidated statement of
financial position result from the present value of the defined benefit obligation adjusted for any
actuarial gains or losses, and less any past service cost not yet recognized. The discount rate is
determined by reference to the capital markets and takes into account the expected maturity of
the obligation. KDG engaged qualified external actuaries to perform the necessary actuarial
calculations. The obligation is determined using the projected unit credit method (“PUCmethod”).
When the benefits of the pension plan are improved, the share of the increased benefit
relating to the employees’ previous years of service will be recognized as an expense on a
straight-line basis over the period until the benefits become vested. If the benefits have already
vested, the prior service cost is expensed immediately.
In measuring the obligations arising from the defined benefit plans, actuarial gains and
losses arising after April 1, 2003 are not recognized in the consolidated statement of income
until the cumulative outstanding amounts exceed a corridor of 10 % (“corridor approach”) of the
defined benefit obligation as of the measurement date. The portion of the amount exceeding the
corridor is amortized to the consolidated statement of income over the remaining average
service period of the employees entitled to pensions.