Page 57 - GlaxoSmithKline Pharmaceuticals AR 2012

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Notes to the Financial Statements for the year ended 31st December, 2012 — continued
46 Employee Benefits:
The Company obtained actuarial reports as required by the Accounting Standard 15, Employee Benefits (revised 2005) [‘the revised
AS 15’], notified under sub-section (3C) of Section 211 of the Companies Act, 1956 based on which disclosures have been made
in the financial statements for the year ended 31st December, 2012.
The disclosures as required by the revised AS 15 are as given below:
1 Brief description of the Plans
The Company has various schemes for long-term benefits such as provident fund, superannuation, gratuity and post retirement
medical. In case of funded schemes, the funds are recognised by the Income tax authorities and administered through trustees /
appropriate authorities. The Company’s defined contribution plans are superannuation and employees’ pension scheme
(under the provisions of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952) since the Company has no
further obligation beyond making the contributions. The liability of the Company on the exempt Provident Fund managed by the
trustees is restricted to the interest shortfall if any. The employees of the Company are also entitled to leave encashment and
compensated absences as per the Company’s policy.
The Company’s defined benefit plans include gratuity, post retirement medical and other benefits.
Rupees
in lakhs
Previous year
Rupees
in lakhs
2 Charge to the Statement of Profit and Loss based on contributions:
Superannuation .. .. .. .. .. .. .. .. 4,32.56 4,17.99
Employees' pension scheme .. .. .. .. .. .. 2,91.28 2,97.59
Provident fund .. .. .. .. .. .. .. .. 6,94.09 6,13.05
14,17.93 13,28.63
3 The Guidance Note on Implementing AS 15, ‘Employee Benefits’ issued by the Accounting Standard Board (ASB) of the Institute
of Chartered Accountants of India states that Provident Funds set up by employers that guarantee a specified rate of return and
which require interest shortfall to be met by the employer would be defined benefit plans in accordance with the requirements
of paragraph 26(b) of AS 15. Pursuant to the Guidance Note, the liability in respect of the shortfall of interest earnings of Fund is
Nil determined on the basis of an actuarial valuation. The interest shortfall liability being “Other Long Term Employee Benefits”,
detailed disclosures are not required.
4 The liability for leave encashment and compensated absences as at year end is Rs. 27,37.69 lakhs (Previous year -
Rs. 24,63.29 lakhs) #.
5 Disclosures for defined benefit plans as on 31st December, 2012:
Rupees in lakhs
Previous year
Rupees in lakhs
Gratuity Post retirement
medical and other
benefits
Gratuity Post retirement
medical and other
benefits
(Funded plan) (Non-funded plan) (Funded plan) (Non-funded plan)
(i) Change in Defined Benefit Obligation
Opening defined benefit obligation .. 47,30.42 29,86.89 46,72.26 28,06.34
Current service cost .. .. .. 3,04.58 30.80 2,96.75 35.63
Interest cost .. .. .. .. 3,78.29 2,46.56 3,89.87 2,19.32
Actuarial loss / (gain) .. .. 4,15.05 6,53.25 (48.83) 96.27
Liabilities assumed on acquisition/
(settled on divestiture) .. .. (6.51) — (8.16) —
Benefits paid .. .. .. (12,32.58) (2,64.70) (5,71.47) (1,70.67)
Closing defined benefit obligation 45,89.25 36,52.80 47,30.42 29,86.89
(ii) Change in Fair Value of Assets
Opening fair value of plan assets .. 31,41.46 32,27.37
Expected return on plan assets .. 2,47.99 2,35.65
Actuarial gain / (loss) .. .. (1,78.15) 49.91
Contributions by employer .. .. 8,90.00 2,00.00
Benefits paid .. .. (12,32.58) (5,71.47)
Closing fair value of plan assets .. 28,68.72 31,41.46