FGV Annual Report 2013

Felda Global Ventures Holdings Berhad 296 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2013 47 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 depend 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 it falls due. Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Non-current -Retirement benefit scheme 20,399 6,700 101 186 -Housing assistance scheme 14,287 12,729 - - 34,686 19,429 101 186 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 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. Following the introduction of the Minimum Retirement Age Act 2012, the Group raised the normal retirement age of the Retirement benefit scheme to 60 years for Malaysian employees. The amendment results in a decrease in the present value of benefits obligation. This decrease is represented as a negative past service cost recognised in the profit or loss amounting to RM2,034,000. 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 service earned from age 55 to 60. The defined benefit plan for Indonesian subsidiary is being described under Indonesian Labour Law No. 13/2003 and the Thailand subsidiary is 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 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 At 1 January 19,429 492 186 24 Recognition of defined benefit plan on transfer of employees from a related company - 18,645 - - Acquisition of subsidiary 16,026 - - - Charged to profit or loss 563 2,523 (32) 21 Benefits paid (1,544) (3,279) (34) - Re-measurement 212 1,048 (19) 141 At 31 December 34,686 19,429 101 186