2. Summary of significant accounting policies (cont’d)
2.21 Employee benefits (cont’d)
(b) Defined benefit plan
The net defined benefit liability or asset is the aggregate of the present value of the
defined benefit obligation at the end of the reporting period reduced by the fair value
of plan assets (if any), adjusted for any effect of limiting a net defined benefit asset
to the asset ceiling. The asset ceiling is the present value of any economic benefits
available in the form of refunds from the plan or reductions in future contributions
to the plan.
The cost of providing benefits under the defined benefit plans is determined
separately for each plan using the projected unit credit method.
Defined benefit costs comprise the following:
-
Service cost
-
Net interest on the net defined benefit liability or asset
-
Remeasurements of net defined benefit liability or asset
Service costs which include current service costs, past service costs and gains or
losses on non-routine settlements are recognised as expense in profit or loss. Past
service costs are recognised when plan amendment or curtailment occurs.
Net interest on the net defined benefit liability or asset is the change during the
period in the net defined benefit liability or asset that arises from the passage of time
which is determined by applying the discount rate based on high quality corporate
bonds to the net defined benefit liability or asset. Net interest on the net defined
benefit liability or asset is recognised as expense or income in profit or loss.
Remeasurements comprising actuarial gains and losses are recognised immediately
in other comprehensive income in the period in which they arise. Remeasurements
are recognised in retained earnings within equity and are not reclassified to profit or
loss in subsequent periods.
The Group’s right to be reimbursed of some or all of the expenditure required to
settle a defined benefit obligation is recognised as a separate asset at fair value
when and only when reimbursement is virtually certain.
(c) Employee leave entitlements
Employee entitlements to annual leave are recognised as a liability when they are
accrued to the employees. The undiscounted liability for leave expected to be settled
wholly before twelve months after the end of the reporting period is recognised for
services rendered by employees up to the end of the reporting period.
NOTES TO THE FINANCIAL
STATEMENTS
For the financial year ended 30 June 2015
ASL Marine Holdings Ltd. /Annual Report 2015
93
