Statement of accounting policies Pension scheme arrangements The Group contributes to a hybrid Group pension scheme, the Keepmoat Limited Group Pension Plan, the assets of which are held in independently administered funds. Contributions and pension costs are based on pension costs across the Group as a whole. Pension scheme assets are measured using market values. Pension scheme liabilities are measured using the projected unit actuarial method and are discounted at the current rate of return on a high quality corporate bond of equivalent term and currency to the liability. The increase in the present value of the liabilities of the Group's defined benefit pension schemes expected to arise from employee service in the period is charged to operating profit. The expected return on the scheme's assets and the increase during the period in the present value of the scheme's liabilities, arising from the passage of time, are included in net interest. Actuarial gains and losses are recognised in the consolidated statement of total recognised gains and losses. Pension scheme surpluses, to the extent that they are considered recoverable, or deficits are recognised in full and presented on the face of the balance sheet net of related deferred tax. The Company is unable to identify its share of the underlying assets and liabilities of the defined benefit element of the Group scheme. As such, the Company has applied the multi-employer exemption provisions of FRS17. The scheme is accounted for by the Company as a defined contribution scheme, charging contributions to the scheme when they become payable.
Provisions Provisions for remedial contract provisions, vacant property obligations and restructuring costs are recognised when: the group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Restructuring provisions comprise employee termination payments. Provisions are not recognised for future operating losses. Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense.
Keepmoat Annual Report and Financial Statements 2012
Published on Jan 22, 2014