These consolidated financial statements are originally issued in Indonesian language.
PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Three months ended March 31, 2008 and 2007 Expressed in rupiah, unless otherwise stated
41
22. ESTIMATED LIABILITY FOR EMPLOYEE BENEFITS continued
a. Retirement Benefits continued The actuarial valuation was determined using the projected-unit-credit method which considered the
following assumptions:
Company Subsidiaries
Discount rate 10.10 in 2008 and 11 in 2007 10.10 in 2008 and 11 in 2007 Wage and salary increase
8 in 2008 and 9 in 2007 8 in 2008 and 9 in 2007
Retirement age 55 years
55 years Average employee turnover
1 for employees with ages from 2 - 5 for employees with
20 years old up to 54 years old ages from 20 years old,
decreasing linearly
to 0 at age 45
Table of mortality Indonesian Mortality
Indonesian Mortality Table 1999 TMI ’99 in 2008
Table 1999 TMI ’99 in 2008 and Commissioners Standard
and Commissioners Standard Ordinary 1980 CSO ’80 in 2007
Ordinary 1980 CSO ’80 in
2007 Disability
10 of the mortality rate 10 at the mortality rate
The provisions for employee benefits recognized in the consolidated statements of income consisted of the following:
2008 2007
Current service costs 2,279,590,250
2,566,188,750 Interest
costs 3,772,526,750
4,575,429,750 Actuarial
loss recognized
106,741,500 328,842,000
Amortization of
past service
costs 1,986,122,750 1,986,122,750
Total employee benefits expense 8,144,981,250
9,456,583,250
A reconciliation of estimated liability for employee benefits is as follows:
2008 2007
Present value of defined benefit obligation 159,530,530,629
174,565,782,879 Unamortized balance of non-vested past service
costs 74,057,201,250 84,777,749,250
Actuarial loss
20,125,206,500 32,027,103,082
Liability recognized in the consolidated balance
sheets 65,348,122,879
57,760,930,547
These consolidated financial statements are originally issued in Indonesian language.
PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Three months ended March 31, 2008 and 2007 Expressed in rupiah, unless otherwise stated
42
22. ESTIMATED LIABILITY FOR EMPLOYEE BENEFITS continued
a. Retirement Benefits continued Movements in the estimated liability for employee benefits are as follows:
2008 2007
Balance at beginning of year 64,279,212,681
54,187,223,918 Provision during the period
8,144,981,250 9,456,583,250
Payments during the period 7,076,071,052
5,882,876,621
Balance at end of period presented as “Non-current
Liabilities - Estimated Liability for Employee Benefits” in the consolidated balance
sheets 65,348,122,879
57,760,930,547
Non-vested past service costs are amortized over the average remaining years of service of active employees, which range from 10 - 18 years in 2008 and from 11 - 18 years in 2007.
b. Post-retirement Healthcare
Benefits Effective March 2005, the Company started to provide post-retirement healthcare benefits the
“Plan” to all of its qualified permanent employees. The plan is not funded. The Company has appointed PT Watson Wyatt Purbajaga, an independent actuary, to calculate the expected
obligations for the post-retirement healthcare benefits. The actuarial valuation was determined using the projected-unit-credit method which considered the
following assumptions: Discount rate
: 10.10 in 2008 and 11.00 in 2007 Claim cost trend
: 8 in 2008 and 2007 Retirement age
: 55 years Mortality rate
: TMI ’99 in 2008 and CSO ’80 in 2007 Disability rate
: 10 of mortality rate Average employee turnover
: 1 for employees with ages from 20 years old up to 54 years old The provision for post-retirement healthcare benefits recognized in the consolidated statements of
income consisted of the following:
2008 2007
Current service costs 205,636,250
198,666,000 Interest
costs 401,297,500
404,372,000 Actuarial
gains 39,068,000
29,597,000 Vested past service costs and
amortization of
non-vested past
service costs
194,496,750 194,496,750
Total post-retirement healthcare benefits 762,362,500
767,937,750
These consolidated financial statements are originally issued in Indonesian language.
PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Three months ended March 31, 2008 and 2007 Expressed in rupiah, unless otherwise stated
43
22. ESTIMATED LIABILITY FOR EMPLOYEE BENEFITS continued
