Page 48 - NIB Annual Report 12-13 | 13-14

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD
Notes to Financial Statements, continued Year ended March 31, 2013
3. Significant accounting policies, continued
(g) NIB employee benefits, continued
In order to calculate the present value of economic benefits, consideration was given to any minimum funding requirements that NIB applied to any plan. An economic benefit was available to NIB if it was realisable during the life of the plan or on settlement of the plan liabilities.
When the benefits of the plan were improved, the portion of the increased benefit relating to past service by employees was recognised in the statement of income, expenses and reserves on a straight-line basis over the average period until the benefits became vested. To the extent that the benefits vested immediately, the expense was recognised immediately in the statement of income, expenses and reserves. NIB recognised all actuarial gains and losses arising from defined benefit plans in the statement of income, expenses and reserves.
Termination benefits were recognised as an expense when NIB was demonstrably committed, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies were recognised as an expense if NIB had made an offer of voluntary redundancy, it was probable that the offer would be accepted, and the number of acceptances could be reliably estimated. If benefits were payable more than 12 months after the reporting period, then they were discounted to their present value.
Short-term employee benefit obligations were measured on an undiscounted basis and were expensed as the related service was provided. A liability was recognised for the amount expected to be paid under a short-term cash bonus if NIB had a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be reliably estimated.
(h) Impairment
(i) Financial assets
Financial assets held for investment purposes are measured at fair value with changes in fair values recognised in the statement of income, expenses and reserves.
Financial assets not held for investment purposes are assessed at each reporting date to determine whether there is objective evidence that they are impaired. A financial asset is impaired if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset, and that loss events(s) had an impact on the estimated
44 | The National Insurance Board of The Turks and Caicos Islands
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future cash flows of that asset that can be reliably estimated.