| NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS l NOTE 25 |
|
| 25. |
Post-employment medical obligations
The Medscheme Group operates a post-employment medical benefit scheme. The accumulated post-employment medical aid obligation was determined by independent actuaries in June 2014 using the projected unit credit method prescribed by IAS 19. Future benefits valued are projected using specific actuarial assumptions and the liability for in-service members are accrued over expected working lifetime.
| |
June 2014
R'000 |
|
June 2013
R'000 |
|
| Balance at the end of the year |
3 202 |
|
3 551 |
|
| |
June 2014
R'000 |
|
June 2013
R'000 |
|
| The amounts recognised in the statement of comprehensive income are as follows: |
|
|
|
|
| Current service cost |
– |
|
– |
|
| Interest cost |
224 |
|
267 |
|
| Expected benefit payments |
(485) |
|
(490) |
|
| Net actuarial loss/(gain) recognised in the current year |
(88) |
|
270 |
|
| Net movement for the year |
(349) |
|
47 |
|
The amount recognised in the statement of financial position is determined as follows:
| |
GROUP
June 2014
R'000 |
|
GROUP
June 2013
R'000 |
|
| Present value of funded obligations |
3 551 |
|
3 504 |
|
| Interest cost |
224 |
|
267 |
|
| Expected employer benefit payments |
(485) |
|
(490) |
|
| Actuarial loss/(gain) |
(88) |
|
270 |
|
| Accrued liability in excess of plan assets |
3 202 |
|
3 551 |
|
| The principal actuarial assumptions used were as follows: |
| |
June 2014
|
|
June 2013 |
|
| Discount rate |
8.10% p.a. |
|
6.80% p.a. |
|
| Healthcare cost inflation |
8.20% p.a. |
|
8.20% p.a. |
|
| Post-retirement mortality |
PA(90) ultimate table* |
|
PA(90) ultimate table* |
|
| *Rated down two years with a 1% improvement p.a. from 2006. |
No explicit assumption was made about additional mortality or healthcare costs due to AIDS.
The liability was recalculated to show the effect of:
| • |
A one percentage point decrease or increase in the rate of healthcare cost inflation; |
| • |
A five or 10 percentage point increase in the rate of healthcare cost inflation for the next five years, thereafter returning
to a healthcare cost inflation of 8.20% p.a |
| • |
A one percentage point decrease or increase in the discount rate. |
Disclosure requirement paragraph 120A(o) of IAS 19
| |
Healthcare cost inflation |
|
| |
Central
assumption
8.20% |
-1% |
+1% |
|
| Accrued liability 30 June 2014 (R million) |
3.202 |
3.179 |
3.226 |
|
| % change |
– |
-0.7% |
+0.7% |
|
| Current service cost + interest cost 2014/15 (R million) |
0.239 |
0.237 |
0.241 |
|
| % change |
– |
-0.8% |
+0.8% |
|
| |
Central
Assumptions |
|
|
|
| Sensitivity results from previous valuation |
8.20% |
-1% |
+1% |
|
| Current service cost + interest cost 2013/14 (R million) |
0.224 |
0.223 |
-*0.225 |
|
| % change |
– |
-0.4% |
+0.4% |
|
| |
Healthcare cost inflation |
|
| |
Central
assumption
8.20% |
+5%
for 5 years |
+10 %
for 5 years |
|
| Accrued liability 30 June 2014 (R million) |
3.202 |
3.267 |
3.344 |
|
| % change |
– |
+2.0% |
+4.4% |
|
| |
Discount rate |
|
| |
Central
assumption
8.10% |
-1%
|
+1
|
|
| Accrued liability 30 June 2014 (R million) |
3.202 |
3.384 |
3.037 |
|
| % change |
– |
+5.7% |
-5.1% |
|
|
| NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS l NOTE 25 |
|
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