Page 210 - Tata_Chemicals_yearly-reports-2017-18

2.20 Employee benefits plans Balance Sheet with a corresponding charge or
credit to retained earnings through OCI in the
2.20.1 In respect of the Company and domestic
period in which they occur. Remeasurements are
subsidiaries
not reclassified to the Consolidated Statement of
Employee benefits consist of provident fund, Profit and Loss in subsequent periods.
superannuation fund, gratuity fund, compensated
Changes in the present value of the defined benefit
absences, long service awards, post-retirement
obligation resulting from plan amendments or
medical benefits, directors’ retirement obligations and
curtailments are recognised immediately in the
family benefit scheme.
Consolidated Statement Profit and Loss as past
(i) Post-employment benefit plans service cost.
Defined contribution plans (ii) Short-term employee benefits
Payments to a defined contribution retirement The short-term employee benefits expected to
benefit scheme for eligible employees in the form be paid in exchange for the services rendered by
of superannuation fund are charged as an expense employees is recognised during the period when
as they fall due. Such benefits are classified as the employee renders the service. These benefits
Defined Contribution Schemes as the Group does include compensated absences such as paid
not carry any further obligations, apart from the annual leave and performance incentives which
contributions made. are expected to occur within twelve months after
the end of the period in which the employee
Defined benefit plans
renders the related services.
Contributions to a Provident Fund are made
The cost of compensated absences is accounted as
to Trusts administered by the Group/Regional
under:
Provident Fund Commissioners and are charged
to the Consolidated Statement of Profit and Loss (a) In case of accumulating compensated
as incurred. The Group is liable for the contribution absences, when employees render service
and any shortfall in interest between the amount that increase their entitlement of future
of interest realised by the investments and the compensated absences; and
interest payable to members at the rate declared
(b) In case of non - accumulating compensated
by the Government of India in respect of the Trust
absence, when the absences occur.
administered by the Group companies.
(iii) Other long-term employee benefits
For defined benefit schemes in the form of gratuity
fund, post-retirement medical benefits, pension Compensated absences which are not expected to
liabilities (including directors) and family benefit occur within twelve months after the end of the
scheme, the cost of providing benefits is actuarially period in which the employee renders the related
determined using the projected unit credit services are recognised as a liability. The cost of
method, with actuarial valuations being carried out providing benefits is actuarially determined using
at each Balance Sheet date. the projected unit credit method, with actuarial
valuations being carried out at each Balance
The retirement benefit obligation recognised in
Sheet date. Long Service Awards are recognised
the Consolidated Balance Sheet represents the
as a liability at the present value of the obligation
present value of the defined benefit obligation as
at the Balance Sheet date. All gains/losses due to
reduced by the fair value of scheme assets.
actuarial valuations are immediately recognised in
The present value of the said obligation is the Consolidated Statement of profit and loss.
determined by discounting the estimated future
2.20.2 In respect of overseas subsidiaries, the liabilities
cash outflows, using market yields of government
for employee benefits are determined and
bonds of equivalent term and currency to the
accounted as per the regulations and principles
liability.
followed in the respective countries
The interest income / (expense) are calculated
(i) Defined contribution schemes
by applying the discount rate to the net defined
benefit liability or asset. The net interest income The USA subsidiaries sponsors defined
/ (expense) on the net defined benefit liability is contribution retirement savings plans. Participation
recognised in the Consolidated Statement of Profit in one of these plans is available to substantially
and loss. all represented and non-represented employees.
These subsidiaries match employee contributions
Remeasurements, comprising of actuarial gains
up to certain predefined limits for non-represented
and losses, the effect of the asset ceiling (if any),
employees based upon eligible compensation and
are recognised immediately in the Consolidated
208 Annual Report 2017-18