Page 120 - RFHL ANNUAL REPORT 2024_ONLINE

118 Notes to the Consolidated Financial Statements
For the Year Ended September 30, 2024.
Expressed in millions of Trinidad and Tobago dollars, except where otherwise stated.

2. Material accounting policies (continued)
2.6 Summary of material accounting policies (continued)
p Employee benefits (continued)
i Pension obligations (continued)

The starting point for this year’s IAS 19, ‘Employee Benefits’ disclosures is the corresponding disclosures for the
year ended September 30, 2023. These disclosures were based on an actuarial valuation of the Plans’ liabilities
carried out at September 30, 2020, rolled forward for three years. An actuarial valuation of the Plan’s liabilities has
been carried out at September 30, 2023, rolled forward using a combination of asset, liabilities, person-by-person,
and global data to September 30, 2024. In doing this the actuaries have allowed for the further accrual of benefits
and the increase in liabilities arising from actual and outstanding salary increases and pension increases during
the period under review. The actuaries have assumed that the Plans’ membership changes during the period
under review have followed the demographic assumptions adopted for last year’s IAS 19 disclosures rather than
allowing for the actual changes in membership.

Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts
included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts
included in net interest on the net defined benefit liability), are recognised immediately in the Consolidated
statement of financial position with a corresponding debit or credit to retained earnings through OCI in the
period in which they occur. Remeasurements are not reclassified to the Consolidated statement of income in
subsequent periods.

Past service costs are recognised in the Consolidated statement of income on the earlier of:
a The date of the plan amendment or curtailment, and
b The date that the Group recognises related restructuring costs.

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Group
recognises the following changes in the net defined benefit obligation under ‘operating expenses’ in the
Consolidated statement of income:
a Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-
routine settlements
b Net interest expense or income

The defined benefit plans mainly expose the Group to risks such as investment risk, interest rate risk and
longevity risk.

The above accounting requirement in no way affects the pension plans which continue to be governed by the
approved Trust Deed and Rules and remain under the full control of the appointed Trustees.

The full results of the valuation exercise are disclosed in Note 10 to these Consolidated financial statements.

ii Other post-retirement obligations
The Group provides post-retirement medical benefits to its retirees. The entitlement to these benefits is usually
based on the employee remaining in service up to retirement age and the completion of a minimum service
period. The expected costs of these benefits are accrued over the shortest period of service that an employee
must complete up to the date the employee is first eligible to retire early in normal health, using a methodology
similar to that for defined benefit pension plans. Independent qualified actuaries carry out a valuation of these
obligations.