157 AUDITED FINANCIAL STATEMENTS 2021 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2021 49 PROVISION FOR DEFINED BENEFIT PLAN The Group operates defined benefit retirement plans in Malaysia, Thailand and Indonesia for all eligible employees. All of the plans are lump sum payments depending on members’ length of service and their salary in the final years leading up to retirement. As the retirement benefit plans are unfunded, the Group meets the defined benefit payment obligations as they fall due. Group Company 2021 2020 2021 2020 RM’000 RM’000 RM’000 RM’000 Non-current – Retirement benefit scheme 28,513 37,652 535 782 – Housing assistance scheme 18,567 25,597 – – – Long service award 4,056 4,243 97 95 51,136 67,492 632 877 The retirement benefit scheme is a final salary defined benefit plan with a guaranteed lump sum payment at retirement, which remains open to new entrants. The housing assistance scheme is a final salary defined benefit plan with a guaranteed lump sum payment at retirement or at an earlier exit through ill-health retirement or death-in-service in Malaysia, which remains open to new entrants. The long service award is for eligible employees that have served the Group upon attainment of 15, 25 and 35 years of service in Malaysia (2020: 15, 25 and 35 years of service). During the financial year, the actuarial cost method for the retirement benefit scheme was revised to attribute the benefits over the employment period up to the retirement age (versus over the entitlement period previously). This change in methodology has resulted in a reduction in the defined benefit obligation as at 31 December 2021 which was fully recognised in the other comprehensive income as part of remeasurements as the impact of the change to the prior periods’ financial statements is not deemed to be material. The Group benefit for retirement scheme shall be paid to the employees who reached the compulsory retirement age and have served the Group for at least twenty (20) years of service in Malaysia (2020: follows the Malaysian Minimum Retirement Age Act 2012 at age of 60). However, the normal retirement age for the housing assistance scheme will remain at age 56 which will be payable at attainment of 56 years old, regardless of whether employees continue employment until the minimum retirement age of 60 years old. There will be no benefits payable for services rendered from age 55 to 60. The defined benefit plan for Indonesian subsidiary is described under Indonesian Labour Law No. 13/2003 and the Thailand subsidiary is under the Legal Severance Plan where the companies are required to pay legal severance payments to employees who leave employment at their retirement age, or are terminated by the companies without reason. The movements during the financial year in the amounts recognised in the statement of financial position of the Group and Company are as follows: Group Company 2021 2020 2021 2020 RM’000 RM’000 RM’000 RM’000 Present value of unfunded obligation: At 1 January 67,492 87,801 877 1,706 Charge/(credit) to profit or loss 7,345 (22,189) 83 (864) Benefits paid (4,089) (2,363) (66) (12) Re-measurement (19,517) 4,333 (262) 47 Currency translation difference (95) (90) – – At 31 December 51,136 67,492 632 877
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