Page 185 - CJ 2019 INTEGRATED REPORT

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1 NOTES TO THE FINANCIAL
STATEMENTS 31 DECEMBER 2019 (CONTINUED)
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Provision for asset retirement obligations This provision relates to to to the the the the estimated cost cost of of dismantling and and and removing an an an an an an an item item of of property plant and and and equipment and and and restoring the the the the the the the site on on on on on on on on which the the the the the the the item item is is is is located to to to to to its its original original condition condition The Group provides for the the the the the the the anticipated costs associated with the the the the the the restoration of of of leasehold property to to to to its its original original condition condition at at at at at at inception of of of the the the the the the lease lease lease including the the the the the the removal of of items included in in in plant and and equipment that is erected on on on on leased land The The Group only recognises these decommissioning decommissioning costs for for the the the proportion of of its overall number of of sites for for which it it it expects decommissioning decommissioning to take place The The expected percentage has been based on on on on on on actual experience in in in the the the respective operations A provision provision is is is is is is is is is made for the the the the the the present value of of of the the the the the the estimated future future decommissioning costs at at the the the the the the end of of of the the the the the the life of of of the the the the the the site/expected lease term When this provision provision gives rise to to future future economic benefits an asset is is is is is is is is is is is recognised otherwise the the the the the costs are charged to to to profit or loss The The estimated cost cost is is is is is is is is is is discounted at at at at a a a a a a a a a a a a a a a a a pre-tax rate that reflects current market assessments o of of of the the the the time time value o of of of money The The increase in in in fin the the the the decommissioning provision due to to the the the the passage o of of of time time is is recognised as as a a a a a finance cost Employee benefits Pension obligations The Group has both defined defined defined benefit benefit benefit and defined defined defined contribution plans plans Typically defined defined defined benefit benefit benefit plans plans define define define define an an an an an amount of of pension pension benefit benefit benefit that an an an an an an an an employee will receive on on on on on on on on on on retirement usually dependent on on on on on on on on on on one or or or more factors such as as age years of of service and compensation A defined contribution contribution contribution plan plan is a a a a a a a a a a a a a a a a a a a a pension pension plan plan under which the the Group Group pays fixed contributions contributions into a a a a a a a a a a a a a a a a a a separate entity The Group Group has no no legal or constructive obligations to to to to pay pay pay further contributions contributions if the the the the fund does not hold sufficient assets to to to to pay pay all employees the the the the benefits relating to to to to employee employee service in in in the the the the current and prior periods • Defined benefit pension Group companies companies operate various pension schemes schemes schemes for for employees eligible for for a a a a a a a a a a defined benefit schemes schemes schemes The schemes schemes schemes are generally funded through payments to insurance companies companies or or or trustee-administered funds determined by periodic actuarial calculations The The liability recognised in fin in fin fin in fin the the the the the the statement of of of of of financial position in fin in fin fin in fin respect of of of of of defined defined defined benefit benefit pension plans is is the the the the the the present value value of of of of of the the the the the the the defined defined defined benefit benefit benefit obligation obligation at at at at at the the the the the the the end end of of of of of the the the the the the the reporting period less the the the the the the the fair value value of of of of of plan plan assets The The The defined defined defined benefit benefit benefit obligation obligation obligation is is is calculated annually by by independent actuaries using using the the the the the the the projected unit credit method The The present value of of the the the the the defined benefit benefit benefit obligation obligation is is is determined by by discounting the the the the the estimated future cash outflows using using interest rates of of of high-quality corporate bonds that that are denominated fin in in in in in in in in the the the the the the the currency fin in in in in in in in in which the the the the the the the benefits will be be be paid and that that have terms terms to to maturity approximating to to the the the the the the terms terms of of the the the the the the related pension liability In countries where there is no no deep market market in in such bonds bonds the the the market market rates on on on on government bonds bonds are used Actuarial gains and and losses arising from experience adjustments and and changes in in in in in in actuarial assumptions are charged or credited to other comprehensive income in in in in in the the the period in in in in in which they arise Past-service costs are recognised immediately in profit or loss Where employees are not covered under defined pension scheme the the the the the present present value of severance allowances calculated on on on on the the the the the basis the the the the the enacted laws fin in in the the the the the countries where the the the the the respective entity operates has has been been provided for The present present value of severance allowances has has been been disclosed within unfunded obligations obligations under retirement benefit obligations obligations • Defined contribution plan For defined contribution contribution plans plans the the the Group Group pays contributions to to publicly or or or or privately administered pension insurance plans plans on on on on on on on on on on on on on a a a a a a a a a a a a a a a a a a a a a mandatory contractual or or or or voluntary basis The The Group Group has no further payment obligations once the the the the contributions contributions contributions have been paid paid The The contributions contributions contributions are are are recognised recognised as as as as as as employee benefit expense when they are are are due Prepaid contributions contributions contributions are are are recognised recognised as as as as an asset to the the the extent that a a a a a a a a a a a a a a a a a a cash refund or a a a a a a a a a a a a a a a a a a reduction in the the the future payments is available INTEGRATED REPORT 2019 (a)