Page 139 - SC Annual Report 2018 (ENG)

Securities
Commission
Malaysia
ANNUAL
REPORT
2018

(ii) state plans

The SC’s contributions to statutory pension funds are charged to profit or loss in the year
to which they relate. Prepaid contributions are recognised as an asset to the extent that a
cash refund or a reduction in future payments is available.

(iii) defined benefit plans

Post-employment benefits

The SC provides post-employment medical coverage to eligible employees engaged prior
to 1 January 2003.

The SC’s net obligation in respect of defined benefit plan is calculated by estimating the
amount of future benefit that employees have earned in the current and prior periods and
discounting that amount.

The calculation of defined benefit obligations is performed by an independent qualified
actuary using the projected unit credit method. When the calculation results in a potential
asset for the SC, the recognised asset is limited to the present value of economic
benefits available in the form of any future refunds from the plan or reductions in
future contributions to the plan. To calculate the present value of economic benefits,
consideration is given to any applicable minimum funding requirements.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and
losses, are recognised immediately in other comprehensive income. The SC determines
the net interest expense or income on the net defined liability or asset for the period
by applying the discount rate used to measure the defined benefit obligation at the
beginning of the annual period to the then net defined benefit liability or asset, taking
into account any changes in the net defined benefit liability or asset during the period as a
result of contributions and benefit payments.

Costs and expenses relating to defined benefit plans are recognised in profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change
in benefit that relates to past service or the gain or loss on curtailment is recognised
immediately in profit or loss. The SC recognises gains and losses on the settlement of a
defined benefit plan when the settlement occurs.

(g) grants

The SC provides grants to eligible entities to undertake capital market activities. Grants are
recognised in profit or loss when payments have been made.

(h) Fair value measurement

Fair value of an asset or a liability is determined as the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date. The measurement assumes that the transaction to sell the asset or transfer
the liability takes place either in the principal market or in the absence of a principal market, in
the most advantageous market.

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