88
Finsbury Food Group Annual Report and Accounts 2020
Notes to the Consolidated Financial Statements/Continued
14. Pension Schemes/Continued
Sensitivity Analysis The calculation of the defined benefit obligation is sensitive to the assumptions set out above. The following table summarises changes in these assumptions and their approximate (decrease)/increase in liabilities.
2020
Discount rate plus 0.5% Discount rate minus 0.5% Inflation plus 0.5% Inflation minus 0.5%
Life expectancy plus 1.0 years Life expectancy minus 1.0 years
(£3.00 million) £3.43 million £3.22 million (£3.18 million) £1.46 million (£1.49 million)
The above sensitivities are approximate and only show the likely effect of an assumption being adjusted whilst all other assumptions remain the same. The weighted average duration of the defined benefit obligation is around 27 years.
Risk Mitigation Strategies During the previous year, the Trustees changed the investment advisory role to a fiduciary investment management role; this brought about a change with the introduction of hedging strategies to its investment portfolio. River and Mercantile were appointed as fiduciary investment manager in December 2018 and a new Statement of Investment Principles (SIP) 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 took place during 2019 aligning to the new SIP.
Effect of the Scheme on the Company’s Future Cash Flows The Company is required to agree a Schedule of Contributions with the Trustees of the Scheme following a valuation which must be carried out at least once every three years. The next valuation of the Scheme will be prepared as at 31 December 2021. In the event that the valuation reveals a larger deficit than expected the Company may be required to increase contributions above those set out in the existing Schedule of Contributions. Conversely, if the position is better than expected contributions may be reduced. The total cash cost to the Company for the current financial year is £435,000 (2019: £402,000). This includes deficit recovery contributions, pension protection fund levy fees and cost of advisors. The Company expects to pay deficit recovery contributions of £500,000 in the year to 26 June 2021. The projected net interest charge to the Consolidated Statement of Comprehensive Income for the year to 26 June 2021 is £224,000. This projection assumes cashflows to and from the Scheme are broadly unchanged from the current year figures and that there will be no events that would give rise to a settlement/curtailment/past service cost.
Consolidated Statement of Financial Position
2020 £000
Fair value of plan assets
Present value of the defined benefit obligation Deficit
Experience adjustments on plan assets as a percentage of plan assets
Experience adjustments on plan liabilities as a percentage of plan liabilities Total remeasurement (losses)/gains as a percentage of plan liabilities
19,607
(34,781) (15,174)
528
2.7% -
0.0%
(3,806) 10.9%
2019 £000
19,238
(30,550) (11,312)
384
2.0% 1,614 5.3% (332) 1.1%
2018 £000
18,834
(29,370) (10,536)
(779)
(4.1%) -
0.0% (172) 0.6%
2017 £000
19,985
(30,483) (10,498)
712
3.6% -
0.0%
(4,031) 13.2%
2016 £000
19,287
(25,750) (6,463)
(1,451) (7.5%) 236
0.9%
(2,595) 10.1%
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96 |
Page 97 |
Page 98 |
Page 99 |
Page 100 |
Page 101 |
Page 102 |
Page 103 |
Page 104 |
Page 105 |
Page 106 |
Page 107 |
Page 108 |
Page 109 |
Page 110 |
Page 111 |
Page 112
