Page 247 - SAMRC Annual Report 2023-24

FINANCIAL INFORMATION

ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024
SIGNIFICANT ACCOUNTING POLICIES

(CONTINUED)

1.15 Employee benefits (continued)
When an employee has rendered service to the entity during a reporting period, the entity recognises the
contribution payable to a defined contribution plan in exchange for that service:
• as a liability (accrued expense), after deducting any contribution already paid. If the contribution
already paid exceeds the contribution due for service before the reporting date, an entity recognises
that excess as an asset (prepaid expense) to the extent that the prepayment will lead to, for example,
a reduction in future payments or a cash refund; and
• as an expense, unless another Standard requires or permits the inclusion of the contribution in the cost
of an asset.

Where contributions to a defined contribution plan do not fall due wholly within twelve months after the end
of the reporting period in which the employees render the related service, they are discounted. The rate used
to discount reflects the time value of money. The currency and term of the financial instrument selected to
reflect the time value of money is consistent with the currency and estimated term of the obligation.

Post-employment benefits: Defined benefit plans
Defined benefit plans are post-employment benefit plans other than defined contribution plans.
Actuarial gains and losses comprise experience adjustments (the effects of differences between the
previous actuarial assumptions and what has actually occurred) and the effects of changes in actuarial
assumptions. In measuring its defined benefit liability, the entity recognises actuarial gains and losses in
surplus or deficit in the reporting period in which they occur.

Assets held by a long-term employee benefit fund are assets (other than non-transferable financial
instruments issued by the reporting entity) that are held by an entity (a fund) that is legally separate from
the reporting entity and exists solely to pay or fund employee benefits and are available to be used only to
pay or fund employee benefits, are not available to the reporting entity’s own creditors (even in liquidation),
and cannot be returned to the reporting entity, unless either:
• the remaining assets of the fund are sufficient to meet all the related employee benefit obligations of
the plan or the reporting entity; or
• the assets are returned to the reporting entity to reimburse it for employee benefits already paid.

Current service cost is the increase in the present value of the defined benefit obligation resulting from
employee service in the current period.

Interest cost is the increase during a period in the present value of a defined benefit obligation which arises
because the benefits are one period closer to settlement.

Past service cost is the change in the present value of the defined benefit obligation for employee service
in prior periods, resulting in the current period from the introduction of, or changes to, post-employment
benefits or other long-term employee benefits. Past service cost may be either positive (when benefits are
introduced or changed so that the present value of the defined benefit obligation increases) or negative
(when existing benefits are changed so that the present value of the defined benefit obligation decreases).
In measuring its defined benefit liability, the entity recognises past service cost as an expense in the
reporting period in which the plan is amended.

Plan assets comprise assets held by a long-term employee benefit fund and qualifying insurance policies.

The present value of a defined benefit obligation is the present value, without deducting any plan assets,
of expected future payments required to settle the obligation resulting from employee service in the
current and prior periods.

SAMRC ANNUAL REPOR T 2023-24 245