Page 332 - SAMRC AnnualReport 2025-26

ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2026
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
(CONTINUED)

31 MARCH 31 MARCH
2026 2025
R R
18. Employee benefit obligations (continued)

Calculation of actuarial gains and losses
Actuarial (gains) losses – Obligation 448,000 1,248,000
Actuarial (gains) losses – Plan assets (671,000) (1,242,000)
(223,000) 6,000

Changes in the fair value of plan assets are as follows:
Opening balance 15,759,000 13,877,000
Return on plan assets 2,085,000 2,653,000
– Interest revenue 1,414,000 1,411,000
– Remeasurements 671,000 1,242,000
Contributions by employer 1,011,000 1,754,000
Payments from the plan (2,721,000) (2,525,000)
16,134,000 15,759,000
Key assumptions used
Assumptions used at the reporting date:
Discount rates used 9.20% 10.50%
Expected rate of return on assets 9.20% 10.50%
General increases in medical aid subsidy 5.80% 6.60%
Proportion of continuing membership at retirement 100.00% 100.00%
Proportion of retiring members who are married 80.00% 80.00%
Retirement age 65 65

The plan accrued liability is taken as the aggregate of the present value of the employer’s obligation required to
settle the subsidies towards each member’s medical scheme contributions, using the discounted cashflow approach.

The subsidies are assumed to be paid or payable, in terms of the employer subsidy policy. The subsidies are
expected to grow with annual medical aid inflation increases allowing for expected future lifetimes of members and
any adult dependent/spouse, in retirement, allowing for joint-life survival probabilities where applicable.
General increases to the employer’s medical aid subsidy (“medical inflation”) take into account the estimated future
changes in the costs of medical services, resulting from both inflation and specific changes in medical costs. The
inflation rate has been determined by reference to market yields at the balance sheet date of long-term bonds.
The medical inflation premium has been set based on past experience for the industry.

Sensitivity analysis
Healthcare cost trends and discount rate
Assumed healthcare cost trends and discount rates have a significant effect on the amounts recognised in surplus
or deficit. A one percentage point change in assumed healthcare cost trends and discount rate would have the
following effects:

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