Osim FR 050407.indd

Notes to the Financial Statements - 31 December 2006 (cont’d)28. Employee benefits (cont’d)a) OSIM Share Option Scheme (con’t)The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that mayoccur. The expected volatility refl ects the assumption that the historical volatility is indicative of future trends, which may alsonot necessarily be the actual outcome. No other features of the option grant were incorporated into the measurement of fairvalue.b) Pension benefits planThis relates to the amount of pension cost provided for by a subsidiary in Taiwan. This subsidiary has a retirement plancovering all its regular employees. Benefi ts under the plan are based on the length of service and estimated based pay atthe time of retirement. The subsidiary made a monthly contribution at certain percentage of the salaries to the pension fund,which is administered by a pension committee and deposited in its name with the Central Trust of China.Certain pension information is as follows:i) Net periodic pension costs are as follows:Group2006 2005$’000 $’000Service cost 38 142Interest cost 41 249Actual returns on plan assets (39) (65)Net amortisation and deferral (32) 42Net pension costs 8 368Notes to the Financial Statements 142Annual Report 2006