Annual Report 2010 - Scana Industrier ASA

68Annual Report 2010 Scana Industrier ASANote 11. Pensions and other long-term employee benefitsIn accordance with the Accounting Act § 7-30a), the companies inNorway are obligated to have a company pension plan in line withthe Act relating to occupational pensions, and the companies have apension plan that meets these requirements.Defined-benefit planThe group’s Norwegian companies are covered by a contractualpension scheme. This scheme covers 519 personnel as at 31December 2010. The obligation is calculated using a linear accrualmethod.In 2010, the old contractual pension scheme was discontinued.The obligation linked to the old contractual pension scheme wasrecognised under operating profit. At the end of 2010, it was decidedthat insufficient cover linked to a new contractual pension schemecorresponding to NOK 7 per employee must be recognised as anobligation. The new contractual pension scheme is classified as adefined-benefit multi-corporate plan. Thus far, we have not receivedsufficient information to undertake the necessary calculations. Thescheme is recognised as a defined-contribution plan. On the date thenecessary information is available, the schemes must be reported asa defined-benefit planIn 2007, Scana Volda discontinued hedged schemes for all employeeswith the exception of the scheme for the managing director. The grouphas no other hedged pension schemes. The scheme covers only 1person as at 31 December 2010.The table below is therefore a presentation of hedged and unhedgedschemes. As at 31 December 2010, the unhedged schemesamounted to NOK 14.6 million of the pension obligation. The pensionassets are placed in Storebrand Livsforsikring.Economic and actuarial assumptions: 2010 2009Discount rate 4.2 % 5.1 %Return on pension assets 5.6 % 6.1 %Salary increases 4.3 % 4.3 %Pension adjustments 2.0 % 2.0 %Inflation rate 2.3 % 2.3 %Voluntary retirement 4.0 % 4.0 %Withdrawal disposition 65 % 65 %Mortality table K2005 K2005Net pension costs are calculated as follows: 2010 2009Present value of net pension entitlement -39 1 678Interest cost of accrued pension obligations 663 1 084Estimated return on pension assets -134 -149Recognised actuarial gains/losses -6 900 -406Recognised effect of plan changes 81 21Net pension costs are calculated as follows: -6 330 2 226Pension obligations and assets: 2010 2009Present value of accrued hedged obligations 17 272 26 559Fair value of pension assets -2 918 -3 121Unrecognised actuarial gains/losses -1 819 -2 833Net recognised pension obligation 31.12 12 535 20 605Changes in gross obligation: 2010 2009Obligation 01.01 26 559 23 660Present value of net pension entitlement for year -39 1 691Interest costs 663 1 072Premiums paid -2 045 -1 773Actuarially calculated loss/gain on obligation -7 866 1 909Gross pension obligation 31.12 17 272 26 559