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
42
22. ESTIMATED LIABILITY FOR EMPLOYEE BENEFITS
a. Retirement Benefits The Company has a defined contribution retirement plan covering its full-time employees.
Contributions are funded and consist of the Company’s and the employees’ contributions computed at 10 and 5, respectively, of the employees’ pensionable earnings. Total
contributions paid by the Company to the plan amounted to Rp24.2 billion in 2006 and Rp21.7 billion in 2005, which were charged to operations.
The plan’s assets are administered by Dana Pensiun Karyawan Indocement Tunggal Prakarsa, the establishment of which was approved by the Ministry of Finance on November 12, 1991,
as amended by Decree No. Kep-332KM.171994 dated December 1, 1994. As of December 31, 2006 and 2005, the Plan assets totaled Rp480.4 billion and Rp395.7 billion, respectively.
The Company and Subsidiaries have appointed PT Mercer Indonesia, an independent actuary, to calculate the expected obligation for post-employment, severance, gratuity and compensation
benefits of its qualified permanent employees 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:
Company Subsidiaries
Discount rate 11 in 2006 and 2005
11 in 2006 and 2005 Wage and salary increase
9 in 2006 and 2005 9 in 2006 and 2005
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,
0 at age 45 Table of mortality
Commissioners Standard Commissioners Standard
Ordinary 1980 CSO ’80 Ordinary 1980 CSO ’80
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:
2006 2005
Current service costs 7,149,230,000
9,922,838,000 Interest costs
16,590,033,000 14,727,976,000
Actuarial loss recognized 101,783,000
119,321,000 Amortization of past service costs
8,511,524,900 7,955,552,975
Total employee benefits expense 32,352,570,900
32,725,687,975
A reconciliation of estimated liability for employee benefits is as follows:
2006 2005
Present value of defined benefit obligation 173,307,041,000
156,375,954,000 Unamortized balance of non-vested past service
costs 86,763,872,000
94,770,637,000 Actuarial loss
32,355,945,082 13,737,803,188
Liability recognized in the consolidated balance sheets
54,187,223,918 47,867,513,812
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
