2007 Annual Report - Sappi

28. Post-employment benefits – pensions continued
2007 2006
Southern Europe North Southern Europe North
US$ million Africa (incl UK) America Total Africa (incl UK) America Total
Pension cost recognised in
income statement
Current service cost 10 11 7 28 9 16 7 32
Past service cost – – – – – (7) 6 (1)
Fund administration costs 1 – – 1 – – – –
Interest cost 24 39 25 88 23 34 23 80
Expected return on plan assets (32) (39) (27) (98) (28) (34) (24) (86)
Amortisation of past service cost – – 1 1 – (5) – (5)
Gain on curtailment
and settlement – – – – (3) – (18) (21)
Pension cost charged to cost of
sales and selling, general and
administrative expenses 3 11 6 20 1 4 (6) (1)
Actual return on plan assets 74 26 42 142 63 25 27 115
Actual return on plan assets (%) 25.0 3.9 12.9 – 20.6 4 9.3 –
Amounts recognised in the
statement of recognised
income and expense
Actuarial gains 36 16 49 101 29 65 7 101
Pension asset surplus
release (restriction) 45 – – 45 (43) – – (43)
Cumulative amount of
actuarial gains and losses
recognised in the statement
of recognised income
and expense
Actuarial gains (losses) 82 (134) (59) (111) 1 (150) (108) (257)
Actuarial assumptions at
balance sheet date:
Discount rate (%) 8.25 5.10-5.75 6.30 8.50 4.50-5.00 5.75
Compensation increase (%) 6.24 3.00-3.50 3.50 6.00 3.00-4.00 3.50
Expected return on assets (%) 9.66 5.00-6.75 8.25 10.50 5.50-6.00 8.25
Actuarial assumptions used to
determine pension expense:
Discount rate (%) 8.50 4.50-5.00 5.75 8.10 3.25-5.00 5.50
Compensation increase (%) 6.00 3.00-4.00 3.50 5.49 2.50-4.00 3.50
Expected return on assets (%) 10.50 5.50-6.00 8.25 9.71 4.90-6.00 8.25
sappi limited | 07 | annual report 131