Page 277 - SAMRC Annual Report 2023-24

FINANCIAL INFORMATION

ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2024
NOTES TO THE ANNUAL FINANCIAL STATEMENTS

(CONTINUED)

17. Employee benefit obligations (continued)

ONE ONE
PERCENTAGE PERCENTAGE
POINT INCREASE POINT DECREASE
31 March 2024
Discount Rate 18,656,000 21,068,000
Medical inflation 21,008,000 18,692,000

31 March 2023
Discount rate 18,452,000 21,033,000
Medical inflation 20,958,000 18,524,000

Discount rate
Assumed discount rate have a significant effect on the liability. A one percentage point change in assumed discount rate
would have the following effects:

The methods and assumptions used in preparing the sensitivity analyses and the limitations of those methods are: The
valuation is based on the Projected Unit Credit valuation method. The expected rate of return on plan assets is based on
market expectation, at the beginning of the period, for returns over the entire life of the related obligation.

The discount rate has been determined by reference to market yields at the balance sheet date of the South African
long-term bonds.

Amounts for the current period and previous four years are as follows:

2024 2023 2022 2021 2020
R R R R R
Defined benefit obligation – partially or wholly funded 18,560,000 18,436,000 19,219,000 20,320,000 21,314,000
Defined benefit obligation wholly unfunded 1,230,000 1,226,000 1,163,000 1,168,000 1,208,000
Plan assets 13,877,000 14,135,000 14,039,000 14,774,000 14,558,000
(Deficit) in the plan (5,913,000) (5,527,000) (6,343,000) (6,714,000) (7,964,000)

Funding arrangements and funding policy

Expected contributions
The expected contributions to the plan for the next reporting period is R NIL.

Pension fund
SAMRC Pension Fund is subject to the provisions of the Pensions Fund Act 24 of 1956. Subject to the provisions of the Act
and the Rules of the Fund, the sole responsibility for the management of the Fund is vested in the Trustees.

The nature of the benefits provided by the plan are the final salary for the defined benefit members as per the pension fund
rules. The risks to which the plan exposes the entity are inflation: The risk that the future CPI inflation, which is the main
driver of future salary increases, is higher than expected and uncontrolled. Open-ended, long-term liability: The risk that
the liability may be volatile in the future and uncertain.

SAMRC ANNUAL REPOR T 2023-24 275