PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2006 With comparative figures for 2005
Expressed in rupiah, unless otherwise stated
43
22. ESTIMATED LIABILITY FOR EMPLOYEE BENEFITS continued
a. Retirement Benefits continued Movements in the estimated liability for employee benefits are as follows:
2006 2005
Balance at beginning of year 47,867,513,812
33,647,515,723 Provision during the year
32,352,570,900 32,725,687,975
Payments during the year 26,032,860,794
18,505,689,886
Balance at end of year recorded as “Non-current
Liabilities - Estimated Liability for Employee Benefits” account in the consolidated balance
sheets 54,187,223,918
47,867,513,812
Non-vested past service costs are amortized over the average remaining years of service of active employees, which range from 11 - 15 years in 2006 and from 12.19 - 16.02 years in 2005.
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 for the years ended December 31, 2006 and 2005.
The actuarial valuation was determined using the “Projected Unit Credit” method which considered the following assumptions:
Discount rate
11 in 2006 and 2005 Claim cost trend
8 in 2006 and 9 in 2005 Retirement age
55 Mortality rate
CSO ’80 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:
2006 2005
Current service cost 907,127,000
804,414,000 Interest cost
1,709,506,000 1,350,536,000
Vested past service cost and amortization of non-vested
past service costs 777,987,000
2,355,378,000
Total post-retirement healthcare benefits 3,394,620,000
4,510,328,000
PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2006 With comparative figures for 2005
Expressed in rupiah, unless otherwise stated
44
22. ESTIMATED LIABILITY FOR EMPLOYEE BENEFITS continued
