Annual report and accounts 2023 - Flipbook - Page 154
A.G. BARR p.l.c. Annual Report and Accounts 2023
Notes to the Accounts continued
1.
Accounting Policies continued
The following temporary differences are not provided for:
• The initial recognition of goodwill; and
• Differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future
Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the year end date and are expected to apply when the related deferred
tax asset is realised or the deferred tax liability is settled. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available
against which the asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Employee benefits
Retirement benefit plans
The Group operates two pension schemes, as detailed in Note 27. The schemes are generally funded through payments to trustee-administered funds. The Group has both
defined benefit and defined contribution plans.
Defined contribution pension plans
A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Obligations for contributions are recognised as an
expense in the income statement as they fall due. The Group has no further payment obligations once the contributions have been paid.
Defined benefit pension plans
A defined benefit plan is a pension plan that is not a defined contribution plan. Typically defined benefit plans define an amount of pension benefit that an employee will
receive on retirement, usually dependent on one or more factors such as age, years of service and compensation.
The liability/surplus recognised in the statement of financial position in respect of defined benefit pension plans is the present value of plan assets less the fair value of the
defined benefit obligation. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method.
The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that
are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension liability.
Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to equity in other comprehensive income in the
period in which they arise.
The Group recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs. The gain or loss on a settlement is the difference between
the present value of the defined benefit obligation being settled as determined on the date of settlement and the settlement price, including any plan assets transferred and
any payments made directly by the Group in connection with the settlement.
The Group’s defined benefit plan was closed to future accrual on 1 May 2016.
152
