177 / 220
1 7 3
NOTES TO THE FINANCIAL STATEMENTS
31 MARCH 2018
Kumpulan Fima Berhad (11817-V) •
Annual Report 2018
29. Retirement benefit obligations (cont’d.)
(a)
The amounts recognised in the statement of financial position are determined as follows:
Group
2018
2017
RM’000
RM’000
Present value of unfunded defined benefits obligations
1,813
1,837
Analysed as:
Non-current
1,813
1,837
(b)
The amounts recognised in the profit or loss are as follows:
Group
2018
2017
RM’000
RM’000
Current service cost
200
199
Interest cost
89
85
Total, included in employee benefits expense (Note 6)
289
284
(c)
The principle assumptions used by the foreign subsidiary in Indonesia in determining employee benefits liability as of
31 March 2018 and 2017 are as follows:
2018
2017
Discount rate
7.3%
7.8%
Annual salary increase
7.0%
7.0%
Retirement age
55
55
The discount rate is determined based on the values of AA rated corporate bond yields with 3 to 15 years of maturity,
converted to estimated spot rates.
Significant actuarial assumptions for determination of the defined benefit obligation are discount rate and expected
salary increase. The sensitivity analysis below has been determined based on changes to individual assumptions, with
all other assumptions held constant.
2018
2017
RM’000
RM’000
A 1 per cent decrease/increase in discount rate will increase/decrease
the defined benefit obligation by
131
143
A 1 per cent increase/decrease in expected salary growth will increase/decrease
the defined benefit obligation by
127
129
The sensitivity analysis presented above may not be representative of the actual change in defined benefit obligation as
it is unlikely the change in assumptions would occur in isolation of one another as some assumptions may be correlated.
The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the
previous year.