Constance Hotels, Resorts and Golf | Annual Report 2023

182

Financial Statements

Constance Hotels Services Limited

Annual Report 2023

183

Financial Statements

Constance Hotels Services Limited

Annual Report 2023

Notes to the Financial Statements Year ended December 31, 2023

Notes to the Financial Statements Year ended December 31, 2023

18.

EMPLOYEE BENEFIT LIABILITIES (continued)

18.

EMPLOYEE BENEFIT LIABILITIES (continued)

Defined pension benefits (continued)

Defined pension benefits (continued)

(a)

(a)

v.

The amounts recognised in profit or loss are as follows:

ix.

Sensitivity analysis on defined benefit obligations at end of the reporting date:

THE GROUP

THE GROUP

2023

2023

2022

2022

MUR’000

MUR’000

MUR’000

MUR’000

34,379

December 31, Decrease in discount rate (1% movement) Increase in discount rate (1% movement) Increase in future long term salary (1% movement) Decrease in future long term salary (1% movement)

Current service cost Scheme expenses

29,975

874

876

53,483 47,513 52,711 46,844

60,061 53,033 64,106 56,202

2,099

Cost of insuring risk benefits

1,745

25,280 62,632

Net interest expense

14,809

Total included in employee benefit expense

47,405

The current service cost, scheme expenses, cost of insuring risk benefits, net interest expenses for the year is included in administrative expenses in the statement of profit or loss. THE GROUP 2023 2022 MUR’000 MUR’000 Actual return on plan assets 15,403 13,244

An increase/decrease of 1% in other principal actuarial assumptions would not have a material impact on defined benefit obligations at the end of the reporting period. The sensitivity above have been determined based on a method that extrapolates the impact on net defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The present value of the defined benefit obligation has been calculated using the projected unit credit method. The sensitivity analysis may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years. x. The defined benefit pension plan exposes the Group to actuarial risks, such as longevity risk, interest rate risk, market (investment) risk and salary risk. Longevity Risk The liabilities disclosed are based on the mortality tables PA(92). Should the experience of the pension plans be less favourable than the standard mortality tables, the liabilities will increase. Interest Rate Risk If the bond interest rate decreases, the liabilities would be calculated using a lower discount rate, and would therefore increase. Investment Risk The present value of the liabilities of the plan are calculated using a discount rate. Should the returns on the assets of the plan be lower than the discount rate, a deficit will arise. Salary Risk If salary increases are higher than assumed in our basis, the liabilities would increase giving rise to actuarial losses.

vi.

The amounts recognised in other comprehensive income are as follows:

THE GROUP

2023

2022

MUR’000

MUR’000

54,489

Liability experience gains

27,953 48,275 76,228 (5,596)

(123,542)

Actuarial losses arising from changes in financial assumptions

(69,053)

Actuarial losses

(206)

Return on plan assets excluding interest income

(69,259)

70,632

vii. The assets of the plan are invested in the Deposit Administration Policy. The Deposit Administration Policy is a pooled insurance product for Group Pension Schemes, underwritten by Swan Life Ltd. It is a long-term investment Policy which aims to provide a smooth progression of returns from one year to the next without regular fluctuations associated with asset-linked investments such as Equity Funds. Moreover, the Deposit Administration Policy offers a minimum guaranteed return of 4% p.a.

viii. The principal actuarial assumptions used for the purposes of the actuarial valuations were:

2023

2022

%

%

xi. The funding requirements are based on the pension fund’s actuarial measurement framework set out in the funding policies of the plan.

4.8-5.4

Discount rate

5.8 - 6.6

1.0

Future salary growth rate

3.5

xii. The Group expects to pay MUR 18.8 million in contributions to its post-employment benefit plans for the year ending December 31, 2024.