Annual Report 2019

Explanatory Notes 30 SEPTEMBER 2019 25. POST EMPLOYMENT BENEFIT ASSETS/LIABILITIES (CONT’D) GROUP Sep-19 Sep-18 MUR m MUR m (a) Pension benefits (cont’d) (iii) Movements in the defined benefit obligations over the year is as follows: At 1 October 34.4 25.5 Current service cost 1.4 1.2 Past service cost 1.0 (1.2) Interest expense 2.1 1.6 Benefits paid on settlement - 1.0 Other benefits paid (0.1) (3.0) Liability experience loss 1.0 6.8 Liability loss/(gain) due to change in financial assumptions 6.8 2.5 At 30 September 46.6 34.4 (iv) Movements in the fair value of plan assets over the year is as follows: At 1 October 41.6 32.3 Interest income 2.6 2.0 Employer contribution 1.6 7.2 Benefits paid (0.1) (2.0) Return on plan assets excluding interest income (0.2) 2.1 At 30 September 45.5 41.6 (v) Sensitivity analysis on defined benefit obligation at end of year Increase due to 1% decrease in discount rate 20.6 17.2 Decrease due to 1% increase in discount rate 16.5 13.7 The above sensitivity analysis has been carried out by recalculating the present value of obligation at the end of the period after increasing or decreasing the discount rate while leaving all other assumptions unchanged. The results are particularly sensitive to a change in the discount rate due to the nature of the liabilities being the difference between a minimum defined benefit liability and the projected defined contribution liabilities, the latter being MUR  52.7M as at 30 September 2019. Any similar variation in the other assumptions would have shown smaller variations in the defined benefit obligation. The sensitivity analysis may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. GROUP Sep-19 Sep-18 % % (vi) Allocation of plan assets at end of year: Equity - local quoted 20 26 Equity - overseas quoted 36 37 Debt - local unquoted 7 2 Debt - overseas quoted 26 27 Property - local 2 3 Cash and other 9 5 100 100 (vii) Future cashflows - The funding policy is to pay contributions to an external legal entity at the rate recommended by the entity’s actuaries. - Expected employer contributions to post-employment benefit plans for the year ending 30 September 2020 are MUR 1.8m. - The average duration of the defined benefit obligations ranges between 5 years and 12 years. CIM FINANCIAL SERVICES LTD / ANNUAL REPORT 2019 136