Measuring


In measuring pension provisions and determining pension costs the 10 per cent corridor rule is applied. Actuarial gains and losses are not taken into account unless they exceed 10 per cent of total obligations or 10 per cent of the fair value of existing plan assets. The amount that exceeds the corridor is divided over the expected average remaining years of service of active staff through profit or loss and recognised in the balance sheet.

Pension obligations are calculated on the basis of the following assumptions:

Actuarial assumptions

in %

31.12.2011

31.12.2010

31.12.2009

*

Post-tax interest since 2008.

Interest rate in Germany

4.5

5.0

5.5

Projected salary increase in Germany

2.75

2.75

2.75

Projected pension increase in Germany

1.0 – 2.75

1.0 – 2.75

1.0 – 2.75

Interest rate abroad

2.5 – 5.0

2.75 – 5.75

3.3 – 5.9

Projected salary increase abroad

1.0 – 4.0

1.5 – 5.0

1.5 – 5.0

Projected pension increase abroad

0.0 – 3.5

0.0 – 3.7

0.0 – 3.5

Health care cost trend for pensioners abroad

5.0 – 7.0

7.5

12.0

Expected return on external plan assets in Germany*

5.2

5.2

5.2

Expected return on external plan assets abroad

2.5 – 8.3

2.4 – 8.3

2.8 – 8.3

Since 31 December 2005 biometric calculations have been based on the 2005 G Heubeck life-expectancy tables, with fluctuation estimated on the basis of age and gender.

The projected return on plan assets is generally based on the plan’s investment policy relating to the selection of asset classes. The projected return on equity investments takes into account historic interest rates, future inflation rates, expected dividends and economic growth. The projected return on fixed-interest instruments is based on current interest rates for long-term securities, subject to a risk discount if appropriate. The projected return on property assets corresponds to that of equity investments. For other assets, mainly bank balances, the interest paid on current deposits on the balance sheet date was applied.

An increase or decrease in the assumed health care costs for pensioners by 1 per cent would have the following effects:

 

in € thousands

Increase
by 1 per cent

Decrease
by 1 per cent

Service costs and interest expenses

+21

–21

Health care commitments

+411

–403

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