Page 109 - ICD AR21 EN

17 EMPLOYEE PENSION LIABILITIES (Continued)
Administration of SRPs
The Pension Committee appointed by the President of IsDB Group, administers SRPs as separate funds on behalf of its employees. The Pension Committee is responsible for the oversight of investment and actuarial activities of the SRPs. The SPP’s assets are invested in accordance with the policies set out by the Pension Committee. The Bank and its affiliates underwrite the investment and actuarial risk of the SRPs and share the administrative expenses.
Risks
Investment risk
The present value of the SRPs’ liability is calculated using a discount rate determined by reference to high quality corporate bond yields; if the return on SRPs’ asset is below this rate, it will create a plan deficit. Currently the SRPs’ have a relatively balanced investment in equity securities, debt instruments and real estate. Due to the long-term nature of the SRPs’ liabilities, the administrator of SRPs’ consider it appropriate that a reasonable portion of the SRPs’ assets should be invested in equity securities and in real estate to leverage the return generated by the fund.
Discount rate
A decrease in the bond return rate will increase the SRPs’ liability but this will be partially offset by an increase in the return on the SRPs’ debt investments.
Longevity risk
The present value of the SRPs’ liability is calculated by reference to the best estimate of the mortality of SRPs’ participants both during and after their employment. An increase in the life expectancy of the SRPs’ participants will increase the SRPs’ liability.
Salary risk
The present value of the SRPs’ liability is calculated by reference to the future salaries of SRPs’ participants. As such, an increase in the salary of the SRPs’ participants will increase the SRPS’ liability.
The breakdown of net employee pension liabilities was as follows:
Defined benefit obligations (note 17.1) Less: plan assets (note 17.2)
Defined benefit obligations (note 17.1) Less: plan assets (note 17.2)
7,108,723
83,638,356
(48,535,006) (2,489,321)
90,747,079 (51,024,327)
101,969,105 (47,515,100)
ANNEXES
2021
SPP
SRMP
Total
31 December 2021 (USD)
Net employee pension liabilities
35,103,350
4,619,402
39,722,752
2020
SPP
SRMP
Total
31 December 2020 (USD)
93,614,706
(45,341,816) (2,173,284)
8,354,399
Net employee pension liabilities
48,272,890
6,181,115
54,454,005
STRONGER TOGETHER 107