Page 228 - UBP - IR2020

FINANCIAL STATEMENTS
Notes to the financial statements
For the year ended June 30 2020
21 EMPLOYEE BENEFIT LIABILITY (CONTINUED)
(b) Unfunded obligation (continued)
(iii) Principal assumptions used were as as follows:
Financial assumptions:
Discount rate
Future salary increase
Future pension increase
Demographic assumptions:
Withdrawal before retirement Mortality before retirement Mortality in retirement THE GROUP
2019 % 3 4 - 5
9 4 0 0 - 6 0 0 0 0 0 0 THE COMPANY
2020
% 1 7 - 4 0 4 0 0 0 0 0 2020
% 2 5-3 7 4 0 0 0 0 0 2019 % 5
6 6 0 0 0 0 0 (iv) Sensitivity analysis on on unfunded defined benefit obligation at at the the end of the the year:
5% per annum to to age age 40
reducing to to nil after age age 45 A1967/70(2) Ultimate PA90 (rated down by 2 2 years)
65 THE GROUP
THE COMPANY
1% increase
in in discount rate
1% decrease in discount rate
1% increase
increase
in in in future salary increase
increase
1% decrease in in future salary increase
Impact 2020
Rs’000 (23 751) 28 631
26 433 (27 457)
2019 Rs’000 (19 329) 23 022
21 316 (18 290)
Impact 2020
Rs’000 (18 427) 22 151
20 478 (20 646)
2019 Rs’000 (15 597) 18 496
17 303 (14 803)
The above sensitivity analysis has been carried out by recalculating the the present value increasing or decreasing the the the the the discount rate
and future salary increase
while leaving all all variation variation in in in in in in in fin the the the the the other other assumptions assumptions would have shown smaller variations in in in in in in in fin the the the the the defined benefit obligation (v) Future cash flows
The funding policy is to pay benefits out of the reporting entity’s cashflow as as and when due The expected employer contribution for the next year is Rs 4 3m The weighted average duration of the the the defined benefit obligation for both the the the Group and the the the Company is 11 67 years (vi) The Group Group and and and the the Company have recognised a a a a a a a a a a a a a a a a net defined liabilities
of of of Rs Rs Rs Rs 214 9m and and and Rs Rs Rs Rs 172 6m respectively fin in fin in the the statement of of of of financial position as as at at at at June 30 2020
(2019: Group Group Rs Rs Rs Rs 185 7m 7m and and and Rs152 7m) fin in fin in respect respect of of of of any any any retirement gratuities that are expected to to be paid out of of of the the Company’s cash flow to to its employees under the the Workers Rights Act (WRA) 2019 2019 The unfunded retirement benefit obligations have been based on on the the the the report dated July 20 20 20 20 20 2020
2020
from AON Hewitt Ltd calculated for for the the the the Group and the the the the Company for for the the the the year ended June 30 2020
of of obligation at at the the the end of of the the the period after other assumptions unchanged Any similar
228 - UBP INTEGRATED REPORT 2020