Adcock Ingram Integrated Report 2018

ANNUAL FINANCIAL STATEMENTS 116 ADCOCK INGRAM  Integrated Report 2018 Annexure C – Defined contribution and defined benefit plan DEFINED CONTRIBUTION PLAN The Company and its subsidiaries contribute to a defined contribution plan for all employees in South Africa. These contributions are expensed. Contributions to the defined contribution plan expected in the following year are R119.5 million (2017: R105.9 million). DEFINED BENEFIT PLAN In addition, the Company and its subsidiaries contributed to a retirement benefit fund in respect of certain retirees. The assets of the funds are held in independent trustee administered funds, administered in terms of the Pension Funds Act No 24 of 1956, as amended. Funds must, in terms of the Pension Fund Act, be valued at least every three years. The latest full actuarial valuation was performed on 30 September 2016. For purposes of production of these disclosures, and in order to comply with the requirements of IAS 19, valuations have been performed by independent actuaries, using the Projected Credit Unit method. Where valuations were not possible due to the limited availability of complete data, roll forward projections of prior completed actuarial valuations were used, taking account of actual subsequent experience. The timing of benefit payments are uncertain. The disclosure of the funded status is for accounting purposes only, and does not necessarily indicate any assets available to the Group. 2018 2017 R’000 R’000 Net benefit expense Interest cost on defined benefit obligation 131 111 Interest income on assets (160) (164) Effect of paragraph 64 29 53 Net benefit expense – – Benefit liability Defined benefit obligation (1 550) (1 495) Fair value of plan assets 1 936 1 820 386 325 Unrecognised due to Paragraph 64 limit (386) (325) – – Changes in the present value of the defined benefit obligation are as follows: Defined benefit obligation at 1 July (1 495) (1 168) Interest cost (131) (111) Benefits paid 42 42 Actuarial gain/(loss) on obligation 34 (258) Defined benefit obligation at 30 June (1 550) (1 495) Changes in the fair value of the defined benefit plan assets are as follows: Fair value of plan assets at 1 July 1 820 1 710 Return 160 164 Benefits paid (42) (42) Actuarial loss (2) (12) Fair value of plan assets at 30 June 1 936 1 820 Asset coverage over liabilities (times) 1.2 1.2