NCC’s restated figures for 2012 due to amended standard for pension recognition

Read original

NCC is applying the revised accounting standard for pension recognition, IAS 19, Employee Benefits, as of January 1, 2013. The principal change is the elimination of the opportunity to use the corridor method, the method previously applied by NCC.

Opening balances for 2013 and reported figures for 2012 have been restated to facilitate comparability. The effect of the restatement on NCC’s financial statements and key figures for full-year 2012 is specified in the appendix.

The amended standard entails that the present value of defined-benefit pension plans and the fair value of plan assets for pensions have to be recognized as a net pension provision. Following the amendment, the recognized pension provision will at all times match the actual net obligation that NCC has for its pensions.

All changes in funded pension plans are to be recognized directly in profit or loss and in other comprehensive income. Changes in pension obligations and plan assets stemming from defined-benefit plans, such as experience-based adjustments and/or changes in actuarial assumptions, are to be presented in other comprehensive income. Accrued costs, such as Current service cost, the interest-rate component and the return on plan assets, are to be recognized in profit or loss. The calculation of the expected return is also being changed since the discount rate on the pension commitment is also used in this calculation.

All historical unrecognized actuarial gains and losses, including effects of special payroll tax, will be deducted from shareholders’ equity, net after tax. As a result, shareholders’ equity at December 31, 2012 is reduced by SEK 1,340 M. Profit after net financial items for 2012 is increased by SEK 15 M. Operating profit is reduced by SEK 18 M, which is an effect of the recognition of interest expense and the return on pension liabilities and assets no longer being recognized as part of operating profit. Net financial items improve by SEK 33 M and net profit for the period after tax is increased by SEK 11 M. The restatement has no impact on cash flow apart from certain reclassifications.

About Us

About NCC Our vision is to renew our industry and provide superior sustainable solutions. NCC is one of the leading companies in the Nordics within construction, infrastructure and property development, with sales of SEK 53 billion and 17,000 employees in 2016. The NCC share is listed on NASDAQ Stockholm.

Subscribe