BP 2006 Annual Report Download - page 157

BP Annual Report and Accounts 2006 155
41 Pensions and other post-retirement benefits continued
$ million
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2006
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Analysis of the amount charged to profit before interest and taxation
UK
pension
plans
US
pension
plans
US
other post-
retirement
benefit plans Other plans Total
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Current service cost 432 216 42 139 829
Past service cost (74) 38 – 39 3
Settlement, curtailment and special termination benefits 4 – – 227 231
Payments to defined contribution plans – 161 – 16 177
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Total operating chargea362 415 42 421 1,240
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Analysis of the amount credited (charged) to other finance expense
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Expected return on plan assets 1,711 564 2 133 2,410
Interest on plan liabilities (1,006) (423) (186) (325) (1,940)
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Other finance income (expense) 705 141 (184) (192) 470
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Analysis of the amount recognized in the statement of recognized income and expense
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Actual return less expected return on pension plan assets 1,305 521 – 141 1,967
Change in assumptions underlying the present value of the plan liabilities 114 195 111 352 772
Experience gains and losses arising on the plan liabilities (24) 17 80 (197) (124)
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Actuarial gain recognized in statement of recognized income and expense 1,395 733 191 296 2,615
Movements in benefit obligation during the year
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Benefit obligation at 1 January 20,063 7,900 3,478 7,414 38,855
Exchange adjustments 2,748 – – 632 3,380
Current service cost 432 216 42 139 829
Past service cost (74) 38 – 39 3
Interest cost 1,006 423 186 325 1,940
Curtailment (20) – – – (20)
Settlement (22) – – – (22)
Special termination benefitsb46 – – 227 273
Contributions by plan participants 38 – – 5 43
Benefit payments (funded plans) (981) (615) (4) (149) (1,749)
Benefit payments (unfunded plans) – (37) (211) (321) (569)
Acquisitions –– –––
Disposals 143 (18) – (7) 118
Actuarial gain on obligation (90) (212) (191) (155) (648)
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Benefit obligation at 31 December 23,289 7,695 3,300 8,149 42,433
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Movements in fair value of plan assets during the year
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Fair value of plan assets at 1 January 23,282 7,317 28 2,280 32,907
Exchange adjustments 3,325 – – 122 3,447
Expected return on plan assetsc1,711 564 2 133 2,410
Contributions by plan participants 38 – – 5 43
Contributions by employers (funded plans) 438 181 – 136 755
Benefit payments (funded plans) (981) (615) (4) (149) (1,749)
Acquisitions –– –––
Disposals 143 (13) – – 130
Actuarial gain on plan assetsc1,305 521 – 141 1,967
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Fair value of plan assets at 31 December 29,261 7,955 26 2,668 39,910
Surplus (deficit) at 31 December 5,972 260 (3,274) (5,481) (2,523)
Represented by
Asset recognized 6,089 617 – 47 6,753
Liability recognized (117) (357) (3,274) (5,528) (9,276)
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5,972 260 (3,274) (5,481) (2,523)
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The surplus (deficit) may be analysed between funded and unfunded plans as follows
Funded 6,089 601 (30) (379) 6,281
Unfunded (117) (341) (3,244) (5,102) (8,804)
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5,972 260 (3,274) (5,481) (2,523)
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The defined benefit obligation may be analysed between funded and unfunded plans as follows
Funded (23,172) (7,354) (56) (3,047) (33,629)
Unfunded (117) (341) (3,244) (5,102) (8,804)
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(23,289) (7,695) (3,300) (8,149) (42,433)
aIncluded within production and manufacturing expenses and distribution and administration expenses.
b
The charge for special termination benefits represents the increased liability arising as a result of early retirements occuring as part of a restructuring programme in the UK and Europe.
cThe actual return on plan assets is made up of the sum of the expected return on plan assets and the actuarial gain on plan assets as disclosed above.
At 31 December 2006 reimbursement balances due from or to other companies in respect of pensions amounted to $479 million reimbursement assets
(2005 $465 million) and $71 million reimbursement liabilities (2005 $71 million). These balances are not included as part of the pension liability, but are
reflected elsewhere in the group balance sheet.