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ICI » Topics » Key financial assumptions - Group

This excerpt taken from the ICI 20-F filed Mar 31, 2006.
Key financial assumptions – Group
The principal weighted average rates used at 31 December were:

  2005   2004  
  % p.a.   % p.a.  
Discount rate 4.8   5.3  
Inflation rate 2.7   2.6  
Long-term rate of increase in future earnings 4.2   4.0  
Increase in pensions in payment 2.7   2.4  
Post-retirement healthcare cost inflation rate 9.0   9.7  
         
Expected rates of return on plan assets:        
Equities 8.2   8.2  
Bonds 4.7   4.9  
Other 5.7   4.6  
         
Expected rate of return on reimbursement rights 5.6   4.6  

The overall expected long-term rate of return on asset assumption is determined on a country-by-country (and Euro-zone) basis. The rates are based on market expectations by asset classes, at the beginning of the period, for returns over the entire life of the related obligations. The assumption setting process is based on short and long-term historical analysis and investment managers’ forecasts for equities, hedge funds and private equity, and the available market yields for bonds.

This excerpt taken from the ICI 6-K filed Mar 14, 2006.
Key financial assumptions – Group
The principal weighted average rates used at 31 December were:

  2005   2004  
  % p.a.   % p.a.  
Discount rate 4.8   5.3  
Inflation rate 2.7   2.6  
Long-term rate of increase in future earnings 4.2   4.0  
Increase in pensions in payment 2.7   2.4  
Post-retirement healthcare cost inflation rate 9.0   9.7  
         
Expected rates of return on plan assets:        
Equities 8.2   8.2  
Bonds 4.7   4.9  
Other 5.7   4.6  
         
Expected rate of return on reimbursement rights 5.6   4.6  

The overall expected long-term rate of return on asset assumption is determined on a country-by-country (and Euro-zone) basis. The rates are based on market expectations by asset classes, at the beginning of the period, for returns over the entire life of the related obligations. The assumption setting process is based on short and long-term historical analysis and investment managers’ forecasts for equities, hedge funds and private equity, and the available market yields for bonds.

EXCERPTS ON THIS PAGE:

20-F
Mar 31, 2006
6-K
Mar 14, 2006

RELATED TOPICS for ICI:

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