Page 146 - SC Annual Report 2018 (ENG)

Securities
Commission
Malaysia
ANNUAL
REPORT
2018

defined benefit obligation
Actuarial assumptions

Principal actuarial assumptions at the end of reporting period (expressed as weighted averages):

2018 2017

Discount rate 5.8% 5.8%
Medical cost inflation 10%, reducing to 10%, reducing
5% in 4 years to 5% in 5 years
Normal retirement age 60 years 60 years

Assumptions regarding future mortality are based on published statistics and mortality tables. The
average life expectancy of an individual retiring at age 60 is 25 (2017: 60 is 25) for males and females
at the end of the reporting date.

At 31 December 2018, the weighted-average duration of the defined benefit obligation was 20.6 years
(2017: 20.6 years).

change in estimate in prior year

In 2017, the SC has appointed Willis Tower Watson (TW) to perform actuarial valuation. There were
changes in the assumption used in the valuation and as a result, there is a decrease in service cost
recognised in profit or loss in 2017 by RM5.4 million.

sensitivity analysis

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions,
holding other assumptions constant, would have affected the defined benefit obligation by the amount
shown below.

defined benefit obligation
Increase decrease
RM’000 RM’000
2018
Discount rate (1% movement) (12,782) 16,425
Medical cost inflation rate (1% movement) 15,819 (12,565)

2017
Discount rate (1% movement) (12,052) 15,473
Medical cost inflation rate (1% movement) 14,937 (11,888)

136 | PART 5 »» STATEMENTS, STATiSTiCS ANd ACTiviTiES

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