Page 253 - Group Insurance and Retirement Benefit IC 83 E- Book

202 AS 15

The difference between the expected return on plan assets
(Rs. 1,175) and the actual return on plan assets (Rs. 2,000) is
an actuarial gain of Rs. 825. Therefore, the net actuarial gain
of Rs. 765 (Rs. 825 – Rs. 60 (actuarial loss on the obligation))
would be recognised in the statement of profit and loss.

The expected return on plan assets for 20X2 will be based on
market expectations at 1/1/X2 for returns over the entire life of
the obligation.

Curtailments and Settlements

110. An enterprise should recognise gains or losses on the curtailment or
settlement of a defined benefit plan when the curtailment or settlement
occurs. The gain or loss on a curtailment or settlement should comprise:

(a) any resulting changeinthe present value of the defined benefit
obligation;

(b) any resulting changeinthe fair value of the plan assets;

(c) any related past service cost that, under paragraph 94, had not
previously been recognised.

111. Before determining the effect of a curtailment or settlement, an
enterprise should remeasure the obligation (and the related plan assets, if
any) using current actuarial assumptions (including current market
interest rates and other current market prices).

112. A curtailment occurs when an enterprise either:

(a) has a present obligation, arising from the requirement of a statute/
regulator or otherwise, to make a material reduction in the number
of employees covered by a plan; or

(b) amends the terms of a defined benefit plan such that a material
element of future service by current employees will no longer
qualify for benefits, or will qualify only for reduced benefits.

A curtailment may arise from an isolated event, such as the closing
of a plant, discontinuance of an operation or termination or suspension