Annual Report
Ausgrid%20AR%202015
Ausgrid%20AR%202015
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Ausgrid – <strong>Annual</strong> <strong>Report</strong> 2014/15 69<br />
i. Significant Actuarial Assumptions at the <strong>Report</strong>ing Date<br />
Expected salary increase rate (excluding promotional increases)<br />
2015 2014<br />
0% pa until 31 Dec 2016 and<br />
2.5% pa thereafter<br />
2.7% pa until 31/12/2014 and<br />
3.5% pa thereafter<br />
Rate of CPI increase 2.5% pa 2.5% pa<br />
Discount rate 3.03% pa 3.6% pa<br />
Pensioner mortality<br />
As per the 2012 Actuarial<br />
Investigation of the fund.<br />
Based on Mercer 2005–09 Standard<br />
Pensioner Mortality Table<br />
j. Sensitivity Analysis<br />
The entity's total defined benefit obligation as at 30 June 2015 under several scenarios is presented below.<br />
Scenarios A to F relate to sensitivity of the total defined benefit obligation to economic assumptions, and scenarios G and H relate to<br />
sensitivity to demographic assumptions.<br />
Base Case<br />
Scenario A<br />
–1.0% discount rate<br />
30 June 2015<br />
Scenario B<br />
+1.0% discount rate<br />
Discount rate 3.03% 2.03% 4.03%<br />
Rate of CPI increase 2.5% 2.5% 2.5%<br />
Salary inflation rate<br />
0% pa until<br />
31 Dec 2016 and<br />
2.5% pa thereafter<br />
0% pa until<br />
31 Dec 2016 and<br />
2.5% pa thereafter<br />
0% pa until<br />
31 Dec 2016 and<br />
2.5% pa thereafter<br />
Defined benefit obligation ($M) 721.9 809.7 651.6<br />
Base Case<br />
Scenario C<br />
+0.5% rate of CPI increase<br />
Scenario D<br />
–0.5% rate of CPI increase<br />
Discount rate 3.03% 3.03% 3.03%<br />
Rate of CPI increase 2.5% 3.0% 2.0%<br />
Salary inflation rate<br />
0% pa until<br />
31 Dec 2016 and<br />
2.5% pa thereafter<br />
0% pa until<br />
31 Dec 2016 and<br />
2.5% pa thereafter<br />
0% pa until<br />
31 Dec 2016 and<br />
2.5% pa thereafter<br />
Defined benefit obligation ($M) 721.9 737.1 708.2<br />
Base Case<br />
Scenario E<br />
+0.5% salary increase rate<br />
Scenario F<br />
–0.5% salary increase rate<br />
Discount rate 3.03% 3.03% 3.03%<br />
Rate of CPI increase 2.5% 2.5% 2.5%<br />
Salary inflation rate<br />
0% pa until<br />
31 Dec 2016 and<br />
2.5% pa thereafter<br />
0.5% pa until<br />
31 Dec 2016 and<br />
3% pa thereafter<br />
0% pa until<br />
31 Dec 2016 and<br />
2% pa thereafter<br />
Defined benefit obligation ($M) 721.9 749.5 702.0<br />
Base Case<br />
Scenario G<br />
+5% pensioner mortality rates<br />
Scenario H<br />
-5% pensioner mortality rates<br />
Defined benefit obligation ($M) 721.9 719.4 724.6<br />
The defined benefit obligation has been recalculated by changing the assumptions as outlined above, whilst retaining all<br />
other assumptions.