AUDITED FINANCIAL STATEMENTS 2022 163 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022 48 PROVISION FOR DEFINED BENEFIT PLAN (CONTINUED) The retirement benefit scheme is a final salary defined benefit plan with a guaranteed lump sum payment at retirement, which remains open to new entrants. The housing assistance scheme is a final salary defined benefit plan with a guaranteed lump sum payment at retirement or at an earlier exit through ill-health retirement or death-in-service in Malaysia, which remains open to new entrants. The long service award is for eligible employees that have served the Group upon attainment of 15, 25 and 35 years of service in Malaysia (2021: 15, 25 and 35 years of service). In the previous financial year, the actuarial cost method for the retirement benefit scheme was revised to attribute the benefits over the employment period up to the retirement age (versus over the entitlement period previously). This change in methodology has resulted in a reduction in the defined benefit obligation as at 31 December 2021 which was fully recognised in the other comprehensive income as part of remeasurements as the impact of the change to the prior periods’ financial statements is not deemed to be material. The Group benefit for retirement scheme shall be paid to the employees who reached the compulsory retirement age and have served the Group for at least twenty (20) years of service in Malaysia (2021: follows the Malaysian Minimum Retirement Age Act 2012 at age of 60). However, the normal retirement age for the housing assistance scheme will remain at age 56 which will be payable at attainment of 56 years old, regardless of whether employees continue employment until the minimum retirement age of 60 years old. There will be no benefits payable for services rendered from age 55 to 60. The defined benefit plan for Indonesian subsidiary is described under Indonesian Labour Law No. 13/2003 and the Thailand subsidiary is under the Legal Severance Plan where the companies are required to pay legal severance payments to employees who leave employment at their retirement age, or are terminated by the companies without reason. The movements during the financial year in the amounts recognised in the statement of financial position of the Group and Company are as follows: Group Company 2022 RM’000 2021 RM’000 2022 RM’000 2021 RM’000 Present value of unfunded obligation: At 1 January 51,136 67,492 632 877 Charge to profit or loss 5,436 7,345 74 83 Benefits paid (5,646) (4,089) (98) (66) Re-measurement (2,770) (19,517) (40) (262) Currency translation difference (175) (95) - - At 31 December 47,981 51,136 568 632 The remeasurement amounts recognised in the other comprehensive income are determined as follows: Group Company 2022 RM’000 2021 RM’000 2022 RM’000 2021 RM’000 Re-measurement: - Changes in financial assumptions (2,320) (4,718) (16) (66) - Experience adjustments (450) (14,799) (24) (196) (2,770) (19,517) (40) (262)
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