Siemens 2011 Annual Report Download - page 304

6 A. To our shareholders 51 C. Combined management’s discussion and analysis 23 B. Corporate Governance
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The rates of compensation increase for countries with signifi-
cant effects with regard to this assumption were as follows for
the years ended September ,  and : U.S.: .% and
.%, U.K.: .% and .%, Switzerland: .% and .%,
Netherlands: .% and .%. The compensation increase
rate for the domestic pension plans for the year ended Sep-
tember , , was .% (: .%). However, due to
the implementation of the BSAV, the effect of the compensa-
tion increase on the domestic pension plans is substantially
eliminated. The rates of pension progression for countries
with significant effects with regard to this assumption were
as follows for the years ended September ,  and :
Germany: .% and .%, U.K.: .% and .% and for the
Netherlands for the year ended September , , .%.
The assumptions used for the calculation of the DBO as of the
period-end of the preceding fiscal year are used to determine
the calculation of interest cost and service cost of the follow-
ing year. The total expected return for the fiscal year will be
based on the expected rates of return for the respective year
multiplied by the fair value of plan assets at the preceding fis-
cal years period-end date. The fair value and thus the expect-
ed return on plan assets are adjusted for significant events af-
ter the fiscal year end, such as a supplemental funding.
The discount rate assumptions reflect the rates available on
high-quality corporate bonds or government bonds of consis-
tent duration and currency at the period-end date. The ex-
pected return on plan assets is determined on a uniform ba-
sis, considering long-term historical returns, asset allocation,
and future estimates of long-term investment returns. In fis-
cal  and fiscal , the expected return on plan assets re-
mained primarily unchanged. Changes of other actuarial as-
sumptions not mentioned above, such as employee turnover,
mortality, disability, etc., had an only minor effect on the
overall DBO as of September , .
Experience adjustments, which result from differences be-
tween the actuarial assumptions and the actual occurrence,
decreased the DBO by .% in fiscal , did not affect the
DBO in fiscal , decreased the DBO by .% in fiscal ,
increased the DBO by .% in fiscal  and did not affect
the DBO in fiscal .
PENSION BENEFITS: SENSITIVITY ANALYSIS
A one-percentage-point change of the established assump-
tions mentioned above, used for the calculation of the NPBC
for fiscal , or a change in the fair value of plan assets of
€ million, as of September , , respectively, would re-
sult in the following increase (decrease) of the fiscal 
NPBC:
Effect on NPBC 
due to a one-percentage-
point / €
(in millions of €) increase decrease
Discount rate 57 (72)
Expected return on plan assets (189) 189
Rate of compensation increase 18 (15)
Rate of pension progression 124 (96)
Fair value of plan assets (32) 32
Increases and decreases in the discount rate, rate of compen-
sation increase and rate of pension progression which are
used in determining the DBO do not have a symmetrical effect
on NPBC primarily due to the compound interest effect creat-
ed when determining the net present value of the future pen-
sion benefit. If more than one of the assumptions were
changed simultaneously, the cumulative impact would not
necessarily be the same as if only one assumption was
changed in isolation.