Annual report 2019

116

ANNUAL REPORT 2019 – BOSKALIS FINANCIAL STATEMENTS 2019 L 9 -- BOSKALIS FINANCIAL STATEMENTS 2019 which are mainly based on average wages and include retirement and survivor’s pension. These pensions are indexed, for the main part with a limit being set to the available contributions and the return on plan assets, respectively. The pension liabilities and pension assets are placed with and managed by the pension funds or insurance companies. The risk for the Group relating to these pensions is therefore limited. The future cash flows for the other arrangements are limited to the actuarially calculated annual premiums based on the cost of purchasing future pension rights. In other funded defined benefit plans there is no enforceable statutory or regulatory direct obligation to cover any deficits to fulfil future actuarial obligations. The contributions are subject to the customary, actuarial assumptions, expected returns and agreed contribution ceiling. Defined benefit pension plans As per 2019, the remaining balance of the net defined benefit obligation mainly relates to a closed insured pension plan, for which future cash inflows consist of the Group’s entitlement to excess returns achieved by the insurance company and future cash outflows for premiums for price indexation of insured pensions. The net defined benefit obligation for this pension plan is based on an estimate of this future cash outflow for premiums. The Group’s entitlement to excess returns is not accounted for as an asset. Both the annual income from excess returns and expense for premiums for price indexation continue to be recognized through the statement of other comprehensive income. Therefore the expected impact of these remaining defined benefit pension plans on future statements of profit or loss is not significant. The composition of plan assets is as follows: 31 DECEMBER 2019 Equities - Bonds 70,175 Investments quoted in active markets 70,175 Cash (non-interest-bearing) 494 Other receivables and payables 3,932 Unquoted investments 4,426 TOTAL PLAN ASSETS 74,601 As at 31 December 2019 and 31 December 2018 the plan assets did not include shares issued by Royal Boskalis Westminster N.V. Pension funds periodically perform asset liability management studies to assess the matching of investment assets with the amount and duration of pension liabilities. Based on the outcome of these studies the nature, mix and duration of assets are regularly adjusted. The average duration of the obligations of the pension plans is about 28 years (2018: 24 years). The table below presents the pension costs from defined benefit pension plans: 2019 Total result defined benefit plans 9,550 Pension costs for defined benefit pension plans charged to the consolidated statement of profit or loss - 1,728 Actuarial gains and losses and asset limitation recognized directly in equity 7,822 Income tax - 1,852 Actuarial gains and losses and asset limitation recognized directly in equity net of income tax 5,970 Effective return on plan assets 15,433 The pension charges for the main pension plans are predominantly in euros. As a consequence, the exchange rate exposure for pension charges in other currencies is considered not material.

2018

2,400

137,470 139,870

917

9,896

10,813

150,683

2018

5,409

- 1,542 3,867

39

3,906

4,780