kontinuita - Komunálna Poisťovňa

NOTES TO
THE FINANCIAL
STATEMENTS
using the same process as for financial assets stated
at amortized cost. The impairment loss on reinsurance
asserts is also calculated in the same way. This
process is described in Note 2.6.
f) Receivables and payables arising from insurance
contracts
Receivables and payables arising from insurance contracts
include mainly amounts due to and from the insured
persons, agents, and brokers. If objective indicators
exist that the receivables arising from insurance contracts
are impaired, the Company adequately reduces their carrying
amount and recognizes the impairment loss in the
income statement. The Company gathers objective evidence
about impaired receivables from insurance contracts
in the same way as for the financial asset category
“Loans and receivables” (Note 2.6).
2.12 Deferred income tax
Deferred income tax is accounted for in the financial
statements in full amount using the balance sheet liability
method, based on temporary differences arising
between the tax base of assets and liabilities and their
carrying amounts in the balance sheet. Deferred income
tax assets and liabilities are measured at the tax
rates that are expected to apply to the period when the
asset is realized or the liability is settled, based on tax
rates (and tax laws) that have been enacted or substantively
enacted by the balance sheet date.
Deferred income tax assets are recognized to the extent
that it is probable that future taxable profit will be
available against which the temporary differences can
be utilized.
2.13 Employee benefits
(i) Defined benefit pension plan not reinsured
The Company pays retirement benefits to its employees
in the amount of one average monthly salary in line
with the minimum requirements set out in the Slovak
Labour Code. The liability recognized on the balance
sheet in respect of defined benefit pension plans is the
present value of the defined benefit obligation at the
balance sheet date, together with adjustments for unrecognized
actuarial gains and losses and past service
costs. Independent actuaries calculate the defined
benefit obligation every year by 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 state bonds with terms
to maturity approximating the terms of the respective
pension plan liability.
Actuarial gains or losses arising from adjustments and
changes in actuarial assumptions are charged or credited
to the income statement when incurred. The effects
of pension plan changes are charged or credited
to the income statement over the average remaining
years of service of the respective employees.
(ii) Defined contribution plans
During the year, the Company pays contributions to
the mandatory health, sickness, old-age, and injury
insurance, to the guarantee fund and unemployment
insurance fund at an amount determined by law
based on gross salaries. During the year, the Company
paid contributions to these funds at 35.2%
(2007: 35.2%) of gross salaries up to the amount of
the monthly salary, which is determined by the relevant
legal regulations. The contribution paid by an
employee was another 13.4% (2007: 13.4%). Costs of
the contributions are recognized in the income statement
in the same period as the related personal
costs.
(iii) Redundancy payments
Redundancy payments are payable when employment
is terminated before the normal retirement
KONTINUITA ANNUAL REPORT 117