HSBC 2005 Annual Report Download - page 270

HSBC HOLDINGS PLC
Notes on the Financial Statements (continued)
268
Summary
2005 2004
US$m US$m
Defined benefit obligation .............................................................................................................. (1,004) (982)
Fair value of plan assets ................................................................................................................. 107 79
Net deficit ....................................................................................................................................... (897) (903)
Experience gains/(losses) on plan liabilities ................................................................................... 19 (15)
Experience gains on plan assets ..................................................................................................... 1–
(Losses)/gains from changes in actuarial assumptions ................................................................... (63) 20
Total net actuarial (losses)/gains .................................................................................................... (43) 5
Actuarial gains and losses represent experience adjustments on plan assets and liabilities as well as adjustments
arising from changes in actuarial assumptions. Total net actuarial losses recognised in equity at 31 December 2005
were US$38 million.
The actuarial assumptions of the healthcare cost trend rates have a significant effect on the amounts recognised. A
one percentage point change in assumed healthcare cost trend rates would have the following effects on amounts
recognised in 2005:
1% increase 1% decrease
US$m US$m
Increase/(decrease) on the aggregate of the current service cost and interest cost .......................... 8(6)
Increase/(decrease) on defined benefit obligation ........................................................................... 108 (86)
HSBC Holdings
Employee compensation and benefit expense in respect of HSBC Holdings’ employees in 2005 amounted to
US$166 million (2004: US$106 million). The average number of persons employed by HSBC Holdings during 2005
was 433 (2004: 421).
Employees of HSBC Holdings who are members of defined benefit pension plans are principally members of either
the HSBC Bank (UK) Pension Scheme or the HSBC International Staff Retirement Benefit Scheme. There is no
contractual or stated policy for charging the net defined benefit cost to HSBC Holdings, which is recognised in the
consolidated accounts of HSBC in the note above. HSBC Holdings pays contributions to plans in accordance with
schedules determined by the Trustees following consultation with qualified actuaries.
Directors’ emoluments
The aggregate emoluments of the Directors of HSBC Holdings, computed in accordance with Part I of Schedule 6 of
the Companies Act, were:
2005 2004
US$000 US$000
Fees ................................................................................................................................................ 2,100 2,713
Salaries and other emoluments ....................................................................................................... 12,869 9,721
Bonuses .......................................................................................................................................... 13,264 17,288
28,233 29,722
Gains on the exercise of share options ............................................................................................ 17 14,078
Vesting of Restricted Share Plan awards ........................................................................................24,221 9,598
In addition, there were payments under retirement benefit agreements with former Directors of US$996,098 (2004:
US$906,000). The provision at 31 December 2005 in respect of unfunded pension obligations to former Directors
amounted to US$16,458,975 (2004: US$17,016,000).
During the year, aggregate contributions to pension schemes in respect of Directors were US$4,819,759 (2004:
US$4,423,122), including US$3,304,081 (2004: US$2,198,072) arising from a Director’s waiver of bonus.
Discretionary bonuses for Directors are based on a combination of individual and corporate performance and are
determined by the Remuneration Committee. The cost of the conditional awards under the Restricted Share Plan is
recognised through an annual charge based on the original cost and the likely level of vesting of shares, apportioned