Download PDF - ChartNexus

Notes to the Financial Statements (cont’d)
For the financial year ended 31 December 2011
27. Provisions (cont’d)
(a) Severance benefits (cont’d)
Principal actuarial assumptions used:
Group
2011 2010
% per annum % per annum
Discount rate 4.75 - 6.80 6.50 - 8.00
Expected rate of salary increases 7.00 - 10.00 10.00
(i) Plan asset
This is in respect of an insurance scheme for a severance pay product based on an agreement between a subsidiary
in Indonesia and an insurance company in Indonesia.
The subsidiary will pay the funding for the future benefit payments to the insurer, and the insurer will accumulate
the subsidiary’s funding in a managed pooled fund. The calculation for the benefits refers to the Collective Labour
Agreement and in certain circumstances to Indonesian Labour Law. The fund earns interest at the rate of 9.5% per
annum (2010: 9.5% per annum).
(b) Mine rehabilitation
The provision for mine rehabilitation is in respect of mine rehabilitation expenditure to be incurred subsequent to the
cessation of production of each mine property. It is provided based on the present value of the estimated expenditure
to be incurred.
28. Borrowings
Group Company
2011 2010 2011 2010
RM’000 RM’000 RM’000 RM’000
Short term borrowings
Unsecured:
Short term trade financing 73,919 40,321 73,919 40,321
Bankers’ acceptances 376,403 508,109 376,403 508,109
Revolving credit 28,553 27,814 – –
Revolving credit (restructured) 15,863 12,362 15,863 12,362
Term loan 1 – 3,000 – 3,000
Term loan 2 26,173 20,861 – –
Term loan 3 4,472 6,181 4,472 6,181
525,383 618,648 470,657 569,973
Long term borrowings
Unsecured:
Revolving credit (restructured) 23,794 38,631 23,794 38,631
Term loan 1 – – – –
Term loan 2 14,276 39,404 – –
Term loan 3 – 4,357 – 4,357
38,070 82,392 23,794 42,988
MALAYSIA SMELTING CORPORATION (43072-A) • ANNUAL REPORT 2011 137