NOTES TO THE FINANCIAL STATEMENTS
for the year ended 31 December 2008
17 Pension Costs (continued)
MDU Services Ltd employs a building block approach in determining the long-term rate of return on pension plan
assets. Historical markets are studied and assets with higher volatility are assumed to generate higher returns
consistent with widely accepted capital market principles. The assumed long-term rate of return on each asset class is
set out within this note. The overall expected rate of return on assets is then derived by aggregating the expected
return for each asset class over the actual asset allocation for the Scheme at the 31 December 2008 rounded to the
nearest 0.25% per annum.
Analysis of the amount charged to Income & Expenditure
2008 2007
£'000 £'000
Current service cost 2,000 2,000
Past service cost - -
Total operating charge 2,000 2,000
Analysis of the amount credited to other finance income
2008 2007
£'000 £'000
Expected return on scheme assets 3,900 3,700
Interest on scheme liabilities (3,600) (3,300)
Net return 300 400
Analysis of amounts recognised in the statement of total
recognised gains and losses (STRGL)
2008 2007
£'000 £'000
Actuarial (losses)/gains on scheme assets (12,600) 200
Actuarial gains on scheme liabilities 8,400 4,000
Actuarial (loss)/gain recognised in the STRGL (4,200) 4,200
63
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