Siemens 2010 Annual Report Download - page 253

147 Consolidated Financial Statements
148 Consolidated Statements of Income
149 Consolidated Statements of Comprehensive Income
150 Consolidated Statements of Financial Position
151 Consolidated Statements of Cash Flow
152 Consolidated Statements of Changes in Equity
154 Notes to Consolidated Financial Statements
(in millions of €, except where otherwise stated
and per share amounts)
261 Additional information

 – Pension plans
and similar commitments
Pension benefits provided by Siemens are currently organized
primarily through defined benefit pension plans which cover
almost all of the Company ’s domestic employees and many of
the Company ’s foreign employees. To reduce the risk exposure
to Siemens arising from its pension plans, the Company per-
formed a redesign of some major pension plans during the last
several years towards benefit schemes which are predomi-
nantly based on contributions made by the Company. In order
to fund Siemens’ pension obligations, the Company ’s major
pension plans are funded with assets in segregated pension
entities.
Furthermore, the Company provides other post-employment
benefits, which primarily consist of transition payments to
German employees after retirement as well as post-employ-
ment health care and life insurance benefits to employees in
the U.S. and Canada. These predominantly unfunded other
post-employment benefit plans qualify as defined benefit plans
under IFRS.
The Consolidated Statements of Financial Position include the
following significant components related to pension plans and
similar commitments based upon the situation as of Septem-
ber ,  and :
September ,
 
Principal pension benefit plans 6,563 4,203
Principal other post-employment benefit plans 730 639
Other 1,171 1,096
Liabilities for pension plans
and similar commitments 8,464 5,938
Prepaid costs for post-employment benefits 37 49
Actuarial (losses) / gains (6,023) (3,141)
Effects in connection with asset ceiling (145) (139)
Income tax effect 1,259 425
Net amount recognized in the
Consolidated Statements of Changes in
Equity (4,909) (2,855)
In addition to the above, the Company has foreign defined
contribution plans for pensions and other post-employment
benefits or makes contributions to social pension funds based
on legal regulations (State plans). The recognition of a liability
is not required because the obligation of the Company is lim-
ited to the payment of the contributions into these plans or
funds.
Other in the table above includes non-principal pension ben-
efit plans, non-principal other post-employment benefit plans
and other long-term post-employment benefit plans. Other
long-term post-employment benefit plans include benefits
granted to former employees immediately after the end of
their employment, independent of the employee’s reason for
leaving.
Principal pension benefits
The principal pension benefit plans cover , participants,
including , active employees, , former employees
with vested benefits and , retirees and surviving depen-
dents. Individual benefits are generally based on eligible com-
pensation levels and / or ranking within the Company hierarchy
and years of service. Retirement benefits under these plans
vary depending on legal, fiscal and economic requirements in
each country. The majority of Siemens’ active employees in
Germany participate in a pension scheme introduced in fiscal
, the BSAV (Beitragsorientierte Siemens Altersversor-
gung). The BSAV is a funded defined benefit pension plan
whose benefits are predominantly based on contributions
made by the Company and returns earned on such contribu-
tions, subject to a minimum return guaranteed by the Com-
pany. The BSAV is funded via the BSAV Trust. In connection
with the implementation of the BSAV, benefits provided under
defined benefit pension plans funded via the Siemens German
Pension Trust were modified to substantially eliminate the ef-
fects of compensation increases by freezing the accrual of
benefits under the majority of these plans.
The Company ’s principal pension benefit plans are explicitly
explained in the subsequent sections with regard to:
> Pension obligations and funded status,
> Components of NPBC,
> Amounts recognized in the Consolidated Statements of
Comprehensive Income,
> Assumptions used for the calculation of the DBO and NPBC,
> Sensitivity analysis,
> Plan assets, and
> Pension benefit payments.