Remuneration to employees following the completion of their employment mainly take the form of ongoing payments to independent authorities or insurance companies, which subsequently assume responsibility for the commitments to employees. Such arrangements are called defined-contribution plans.
The commitment for old-age pensions and survivor pensions for employees in Sweden is covered through insurance with Alecta. According to a statement from the Swedish Financial Reporting Board, UFR 3, this is a defined-benefit multi-employer scheme. For the 2009 financial year, the Group did not have access to such information that makes it possible to recognize this plan as a defined-benefit scheme. The pension scheme in accordance with ITP, which is safeguarded through insurance with Alecta, is therefore recognized as a defined-contribution scheme. Alecta’s surplus can be distributed to the insurers and /or the insured. At the close of 2009, Alecta’s surplus in the form of the collective consolidation level was 141% (112%). The collective consolidation level comprises the market value of Alecta’s assets as a percentage of the insurance commitment calculated in accordance with Alecta’s actuarial calculation assumption, which does not coincide with IAS 19.
Defined-benefit plans are characterized by the fact that the Group retains its commitment until the pension has been paid. The costs and provisions for defined-benefit plans are assessed through actuarial calculations with the purpose of determining the current value of the commitment. Defined-benefit plans exist only in Sweden.
The tables below provide data on the Group’s defined-benefit plans, the assumptions used in the calculations, the expenses recognized and the values of the commitments and insurance plan assets.
| Group | |||||
| SEK M | 2009 | 2008 | 2007 | 2006 | 2005 |
| Multi-year overview | |||||
| On the balance-sheet date | |||||
| Current value of defined-benefit obligations | 35,079 | 36,945 | 39,488 | 39,571 | 48,225 |
| Fair value of pension capital | –38,241 | –42,626 | –45,053 | –37,068 | –40,813 |
| Unrecognized actuarial (losses)/gains | 1,881 | 4,979 | 4,913 | 4,832 | –1,667 |
| Liability/(Asset) | –1,281 | –702 | –653 | 7,335 | 5,745 |
| Group | Parent Company | ||||
| SEK 000s | 2009 | 2008 | 2009 | 2008 | |
| Assumptions applied in actuarial calculations | |||||
| Sweden | |||||
| Average discount rate | 3.75% | 3.75% | 3.75% | 3.75% | |
| Forecast return on pension capital | 5.50% | 5.50% | 5.50% | 5.50% | |
| Estimated long-term pay increase | 3.00% | 3.00% | 3.00% | 3.00% | |
| Estimated long-term inflation | 2.00% | 2.00% | 2.00% | 2.00% | |
| Assumptions regarding mortality are the same as those specified by | |||||
| the Swedish Financial Supervisory Authority (FFFS 2007:31). | |||||
| Pension expenses for the year | |||||
| Costs of benefits earned during the year | 1,578 | 1,666 | 10 | 91 | |
| Interest expenses | 1,415 | 1,734 | 982 | 1,225 | |
| Depreciation of actuarial gains/loss | –558 | –42 | –111 | –34 | |
| Adjustment costs | 1,509 | 983 | — | — | |
| Forecast return on pension capital (–) | –2,279 | –1,917 | –1,392 | –1,392 | |
| Expenses for the year pertaining to defined-benefit pension plans | 1,666 | 2,424 | –511 | –110 | |
| Expenses for the year pertaining to defined-contribution pension plans | 60,417 | 53,016 | 34,605 | 27,707 | |
| Payroll tax expense for the year | 17,108 | 10,931 | 8,799 | 5,042 | |
| Pension expense for the year included in personnel expenses | 79,191 | 66,371 | 42,893 | 32,639 | |
| Actual return on pension capital | –4.27% | 5.42% | –5.02% | 7.61% | |
| All items are recognized as personnel expenses. Of the costs for definedcontribution plans, SEK 55,475,000 (37,998,000) comprises premiums to Alecta. | |||||
| Liability in balance sheet, Jan. 1 | |||||
| Pension obligation | 36,945 | 39,488 | 26,187 | 28,436 | |
| Pension capital | –42,626 | –45,053 | –27,176 | –27,176 | |
| Unrecognized actuarial (losses)/gains | 4,979 | 4,913 | 3,719 | 3,188 | |
| Liability recognized in the balance sheet | –702 | –653 | 2,730 | 4,448 | |
| Liability in balance sheet, Dec. 31 | |||||
| Pension obligation | 35,079 | 36,945 | 21,761 | 26,187 | |
| Pension capital (–) | –38,241 | –42,626 | –22,156 | –27,176 | |
| Unrecognized actuarial (losses)/gains | 1,881 | 4,979 | 2,614 | 3,719 | |
| Liability recognized in the balance sheet | –1,281 | –702 | 2,219 | 2,730 | |
| Changes in fair value of pension capital | |||||
| Pension capital, Jan. 1 | 42,626 | 45,053 | 27,176 | 27,176 | |
| Expected return | 2,279 | 1,917 | 1,392 | 1,392 | |
| Adjustment of liability/cost for plan adjusted during the year | –685 | –2,941 | — | — | |
| Withdrawal | –4,122 | –4,444 | –3,656 | –2,848 | |
| Premiums/deposits | 2,244 | 2,643 | — | 856 | |
| Actuarial gains/(losses) | –4,101 | 398 | –2,756 | 600 | |
| Pension capital, Dec. 31 | 38,241 | 42,626 | 22,156 | 27,176 | |
| The majority of these assets are covered via insurances. | |||||
| Group | Parent Company | ||||
| SEK 000s | 2009 | 2008 | 2009 | 2008 | |
| Changes in defined-benefit pension obligation | |||||
| Obligation, Jan. 1 | 36,945 | 39,488 | 26,187 | 28,436 | |
| Cost for benefits earned during the year | 1,578 | 1,666 | 10 | 91 | |
| Adjusted liability/costs for plan adjusted during the year | 816 | –1,686 | — | — | |
| Interest expense | 1,415 | 1,734 | 982 | 1,225 | |
| Pension payments | –4,122 | –4,274 | –3,656 | –3,600 | |
| Actuarial (gains)/losses | –1,553 | 17 | –1,762 | 35 | |
| Obligation, Dec. 31 | 35,079 | 36,945 | 21,761 | 26,187 | |
| Changes in actuarial losses/gains | |||||
| Unrecognized actuarial (losses)/gains, Jan. 1 | 4,979 | 4,913 | 3,719 | 3,188 | |
| 10% of the largest Obligation/Pension capital amount | 4,263 | 4,505 | 2,718 | 2,844 | |
| Unrecognized actuarial (losses)/gains outside the corridor | — | — | 1,001 | 344 | |
| Depreciation of actuarial losses/(gains) | –558 | –42 | –111 | –34 | |
| Adjustment of actuarial losses/(gains) | 8 | –272 | — | — | |
| Actuarial gains/(losses) on obligation | 1,553 | –17 | 1,762 | –35 | |
| Actuarial gains/(losses) on pension capital | –4,101 | 398 | –2,756 | 600 | |
| Unrecognized actuarial (losses)/gains, Dec. 31 | 1,881 | 4,979 | 2,614 | 3,719 | |
| Reconciliation of changes in liability | |||||
| Liabilities in balance sheet, Jan. 1 | –702 | –653 | 2,730 | 4,448 | |
| Pension expense for the year | 1,666 | 2,424 | –511 | –110 | |
| Paid plan assets to capital under management | –2,244 | –2,643 | — | –856 | |
| Withdrawal from plan assets from capital under management | 4,122 | 4,444 | 3,656 | 2,848 | |
| Pension payments (–) | –4,122 | –4,274 | –3,656 | –3,600 | |
| Liability in balance sheet, Dec. 31 | –1,281 | –702 | 2,219 | 2,730 | |
| Change in payroll tax liability | |||||
| Liability in balance sheet, Jan. 1 | 10,268 | 12,634 | 9,371 | 11,467 | |
| Change in payroll-tax liability for the year | 522 | –2,366 | 729 | –2,096 | |
| Liability in balance sheet, Dec. 31 | 10,790 | 10,268 | 10,100 | 9,371 | |
| Net provision, Dec. 31 | 9,509 | 9,566 | 12,319 | 12,101 | |
| In the balance sheet, liabilities are recognized as Pension provisions, and assets as Other long-term liabilities | |||||