Strategic Review


70 Finsbury Food Group Annual Report & Accounts 2019


Notes to the Consolidated Financial Statements


Corporate Governance


Financial Statements


14. Pension Schemes (continued)


The present value of the Company’s committed deficit reduction contributions does not give rise to a net pension asset or additional balance sheet liability in accordance with IFRIC 14.


In the prior year approximately 90% of the assets were held in two diversified growth funds which targeted 6 month LIBOR +5% and CPI + 5% respectively. During the year, the Trustees looked to change the investment advisory role to a fiduciary investment management role. Following an in-depth review of investment advisers, the Trustees with the full support of the sponsoring company changed its approach to appoint a fiduciary investment manager with the introduction of hedging strategies to its investment portfolio. River and Mercantile was appointed as fiduciary investment manager in December 2018 and a new Statement of Investment Principles (SIP) in compliance with the Pensions Act 1995, the Pensions Act 2004 and the Occupational Pension Schemes (Investment) Regulations 2005 was agreed in January 2019. All of the Scheme’s investments meet the criteria detailed in the SIP relevant for the Scheme year to 31 December 2018. A change of investments has taken place during 2019 aligning to the new SIP. The expected return on cash balances held is based on the current Bank of England base rate rather than long term deposit rates as cash is held to cover short term requirements.


The full actuarial valuation differs from the financial year end valuation deficit of £11,312,000 (2018: £10,536,000). No allowance is made in the financial year end valuation for any outperformance expected from the Scheme’s actual asset holding over and above high-quality corporate bonds.


2019 £000


Fair value of plan assets


Present value of defined benefit obligations Deficit recognised


The fair value of plan assets and the return on those assets were as follows:


2019 £000


Multi-asset growth fund


Liability hedging portfolio (gilts/swaps) Other


Equities/target return fund Property Cash


Fair value of plan assets Actual return on plan assets


14,405 2,256 1,580 -


753 244


19,238 886


None of the fair values of the assets shown above includes any of the Company’s own financial instruments or any property occupied by, or any other assets used by, the Company.


2019 £000


Movements in present value of defined benefit obligation At beginning of financial year Past service costs


Interest on plan obligations Benefits paid


Remeasurement – experience gain on liabilities Remeasurement – settlement or curtailment


Remeasurement – (loss)/gain from changes to financial assumptions Remeasurement – gain from changes to demographic assumptions At end of financial year


Movements in fair value of plan assets At beginning of financial year Interest on plan assets


Return on plan assets less interest Benefits paid


Contributions by employer At end of financial year


2018 £000


2018 £000


- - -


16,608 2,145 81


18,834 (251)


19,238


(30,550) (11,312)


2018 £000


18,834


(29,370) (10,536)


(29,370) (362) (784) 682


1,614 -


(2,631) 301


(30,550)


18,834 502 384


(682) 200


19,238


(30,483) -


(805)


1,293 -


18


607 -


(29,370)


19,985 528


(779)


(1,293) 393


18,834


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