Other liabilities
Other provisions
(€ million) | 31.12.2011 | 31.12.2010 |
---|---|---|
Provisions for taxation | 68.8 | 90.1 |
Provisions for commitments | 745.4 | 758.2 |
Other provisions | 572.0 | 648.2 |
Total | 1,386.2 | 1,496.5 |
The main changes occurred in the period are summarized in the table below:
(€ million) | 31.12.2011 | 31.12.2010 |
---|---|---|
Carrying amount as at 31 December previous year | 1,496.5 | 1,490.5 |
Foreign currency translation effects | -0.9 | 13.0 |
Changes in consolidation scope | 3.4 | 3.3 |
Variations | -112.9 | -10.2 |
Carrying amount as at 31 December current year | 1,386.2 | 1,496.5 |
Provisions for defined benefit plan
The pension benefits of Generali Group’s employees are mainly in form of defined benefit plans and defined contribution plans.
As for defined benefit plans, participants are granted a defined pension benefits by the employers or via external entities.
The main defined benefits plans are concentrated in Germany, Austria and Switzerland, while in Italy the provision for Trattamento di fine rapporto (employee severance pay) matured until 1st January 2007 is included in the provisions for defined benefit plan.
(€ million) | 31.12.2011 | 31.12.2010 | 31.12.2009 | 31.12.2008 | 31.12.2007 |
---|---|---|---|---|---|
Present value of defined benefit plan obligation | 4,684.7 |
4,484.0 | 4,030.2 | 3,800.4 | 3,194.4 |
Fair value of plan assets | -1,628.0 |
-1,613.8 | -1,401.0 | -1,321.2 | -682.2 |
Status funded | 3,056.8 | 2,870.2 | 2,629.2 | 2,479.3 | 2,512.2 |
Net actuarial gains or (losses) not recognised | -350.3 |
-190.6 | 22.3 | 145.0 | 77.8 |
Past service cost not recognised | 3.6 |
0.0 | 0.2 | -0.9 | -0.3 |
Net liability recognised in the Balance Sheet | 2,710.1 | 2,680.7 | 2,651.6 | 2,623.4 | 2,589.7 |
The funded status arising from the application of IAS 19 increased from € 2,870.2 as at 31 December 2010 million to € 3,056.8 million as at 31 December 2011.
The increase was mainly due to the increase of the present value of the defined benefit plan obligations, following the reduction of the discount rate applied in the “Project Unit Credit Method”(1) valuation.
(1) Refer to Assicurazioni Generali, Annual Report 2010, Basis for Presentation and Accounting Principles.
For many of the Group’s defined benefit plans there are assets that are designated, but not legally segregated, to meet the pension defined benefit obligations. These are investments related to insurance policies issued by Generali Group insurers, or other investments owned by the Group entities. Consequently, in accordance with IAS 19 these are not recognised as plan assets and so cannot be deducted from the defined benefit obligations. However, to obtain the economic net liability for defined benefit plans these assets would have to be netted against the present value of the related pension obligations.
This is predominantly for Germany and Austria, where the Group retains about the 60% of the present value of defined benefit obligations. Moreover, in these countries, the pension guarantee associations, to the extent of the yearly contributions paid by the companies, are liable for the fulfilment of the pension commitments granted in case of companies insolvency.
The net defined benefit plans expense of the year recognised in the profit or loss account aroused from the following items:
(€ million) | 31.12.2011 | 31.12.2010 |
---|---|---|
Current service cost | 93.0 | 86.0 |
Interest expense | 192.9 | 185.8 |
Expected return on plan assets | -66.7 | -62.4 |
Net actuarial losses recognised in the period | -43.4 | -5.0 |
Past service cost | 2.7 | 2.7 |
Curtailments and settlements effect | -1.2 | -4.3 |
Net expense recognised in the income statement | 177.4 | 202.8 |
The table below shows the net defined benefit plans liability movements occurred during the financial year 2011:
(€ million) | 31.12.2011 | 31.12.2010 |
---|---|---|
Net liability as at 31 December previous year | 2,680.7 | 2,651.6 |
Foreign currency translation effects | 1.8 | 8.0 |
Net expense recognised in the income statement | 181.5 | 202.8 |
Contributions and benefits payed | -153.1 | -181.5 |
Changes in consolidation scope | -0.8 | -0.2 |
Net liability as at 31 December current year | 2,710.1 | 2,680.7 |
The defined benefit plans’ weighted-average asset allocation by asset category is as follows:
(%) 31.12.2011 |
(%) 31.12.2010 |
|
---|---|---|
Bonds | 54.6 | 55.9 |
Equities | 16.9 | 16.5 |
Rael estates | 11.7 | 11.4 |
Investment fund units | 7.4 | 5.9 |
Other investments | 9.3 | 10.3 |
Total | 100.0 | 100.0 |
The assumptions used in the actuarial calculation of the defined benefit obligations and the related periodic pension cost are based on the best estimates of each companies granting defined benefit plans.
The weighted-average principal assumptions used to calculate the Group’s defined benefit obligations – except the Italian provisions for Trattamento di fine rapporto (employee severance pay) – of the financial year 2011 are as follows:
Eurozone |
Switzerland | United Kingdom |
USA | |||||
---|---|---|---|---|---|---|---|---|
% |
31.12.2011 | 31.12.2010 | 31.12.2011 | 31.12.2010 | 31.12.2011 | 31.12.2010 | 31.12.2011 | 31.12.2010 |
Discount rate | 4.9 | 4.9 | 2.5 | 3.0 | 4.7 | 5.4 | 4.4 | 5.6 |
Expected long-term rate of return on plan assets | 4.4 | 4.5 | 3.7 | 4.0 | 6.0 | 6.8 | 8.0 | 8.0 |
Rate of salary increase | 3.0 | 2.9 | 1.9 | 2.0 | 0.0 | 5.3 | 3.3 | 4.0 |
Rate of pension increase | 2.0 | 2.0 | 0.0 | 0.4 | 3.6 | 3.9 | 0.0 | 0.0 |
Other liabilities
(€ million) | 31.12.2011 | 31.12.2010 |
---|---|---|
Liabilities directly associated to non-current assets and disposal groups classified as held for sale |
0.0 | 0.0 |
Deferred tax liabilities | 5,949.2 | 3,753.3 |
Tax payables | 1,339.1 | 1,607.1 |
Other liabilities | 4,531.7 | 4,348.0 |
Provision for other defined benefit plans | 2,601.6 | 2,563.4 |
Termination benefit liabilities | 90.2 | 86.8 |
Accrued interest expense | 373.9 | 369.1 |
Other accrued expenses | 316.8 | 308.4 |
Deferred expenses | 99.5 | 100.6 |
Deferred income for investment management services | 12.3 | 14.8 |
Miscellaneaus liabilities |
1,037.5 | 905.0 |
Total | 11,820.0 | 9,708.4 |
Defined benefit obligation
(€ million) | 31.12.2011 | 31.12.2010 |
---|---|---|
Defined benefit obligation as at 31 December previous year | 4,484.0 | 4,030.2 |
Foreign currency translation effects | 39.1 |
203.1 |
Current service cost | 93.0 | 86.0 |
Past service cost | 4.3 |
3.3 |
Interest expense | 192.9 |
185.8 |
Actuarial (gains) and losses | 83.6 |
192.9 |
Curtailments and settlements effect | 13.8 |
-11.0 |
Contribution by plan participants | 11.9 |
18.5 |
Benefits paid | -237.0 |
-226.0 |
Changes in consolidation scope | -1.0 |
1.3 |
Defined benefit obligation as at 31 December current year | 4,684.7 | 4,484.0 |
Defined benefit obligation
|
31.12.2011 |
31.12.2010 |
---|---|---|
Fair value of plan assets as at 31 December previous year | 1,613.8 | 1,401.0 |
Foreign currency translation effects | 33.0 | 184.6 |
Expected return on plan assets | 66.7 | 62.4 |
Actuarial (gains) and losses | -52.2 | -29.3 |
Curtailments and settlements effect | 0.0 | -6.6 |
Employer contribution | 37.4 | 54.2 |
Contribution by plan participants | 19.5 | 26.7 |
Benefits paid | -89.0 | -79.4 |
Changes in consolidation scope | -1,2 | 0.3 |
Net liability as at 31 December current year | 1,628.0 | 1,613.8 |