Financial Statements - Solvay

92
Solvay Global Annual Report 2008
Total Group post-employment benefi t obligations by country
in % at end 2007 in % at end 2008
Netherlands 26 % 26 %
Germany 23 % 24 %
Belgium 17 % 19 %
USA 16 % 17 %
UK 6 % 5 %
France 6 % 7 %
Other countries 6 % 4 %
Post-employment benefi t plans are classifi ed into defi ned contribution and defi ned benefi t plans.
Defi ned contribution plans
Defi ned contribution plans are those for which the company pays fi xed contributions into a separate entity or fund
in accordance with the provisions of the plan. Once these contributions have been paid, the company has no further
obligation. EUR 30 million of contributions to these plans were charged to income in 2008 (EUR 32 million in 2007).
This decrease is mainly due to the sale of Solvay Engineered Polymers in the USA.
Defi ned benefi t plans
All plans which are not defi ned contribution plans are deemed to be defi ned benefi t plans. These plans can be either
funded via outside pension funds or insurance companies (“funded plans”) or fi nanced within the Group (“unfunded
plans”). All main plans are assessed annually by independent actuaries. The amounts charged to income in respect of
these plans are:
EUR Million 2007 2008
Service cost: employer 48 44
Interest cost 115 123
Expected return on plan assets -79 -81
Amortization of actuarial net losses / gains (-) 14 14
Impact of change in asset ceiling - current year 0 -12
Past service cost - recognized in current year 0 -13
Losses / gains (-) on curtailments / settlements -1 -9
Net expense recognized - Defi ned benefi t plans 97 66
The cost of these benefi t plans is charged variously to cost of sales, commercial and administrative costs, research &
development costs, other fi nancial or operating gains and losses and non-recurring items.
Overall the charge has decreased to EUR 66 million mainly due to:
– a EUR -17 million amendment of the post retirement medical plan in the US (past service cost - recognized in current
year), partially offset by adjustments of plans in Switzerland and the Netherlands that were previously treated as defi ned
contributions;
– curtailment on retiree medical plan in Inergy US, on post-employment benefi ts in sold activities (Solvay Engineered
Polymers and Solvay Interox UK for Caprolactones) and on non-competition indemnities in Belgium.
The favorable impact of change in asset ceiling that corresponds to an income of EUR 9 million for Solvay Chemie
Netherlands and of EUR 3 million for Portugal is offset by an amortization of actuarial net losses.