SCH2017_DRF_EN_Livre.indb

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Consolidated financial statements at December 31, 2017 Notes to the consolidated financial statements

Other post-employment and long-term benefits: including healthcare, life insurance and long service awards The North American subsidiaries pay certain healthcare costs and provide life insurance benefits to retired employees who fulfill certain criteria in terms of age and years of service. The average duration of these North American plans is 8.7 years. These post-employment benefit obligations are unfunded. Healthcare coverage for North American employees represents 72% of this obligation.

The main benefits paid in 2017 are primarily for the North American plans and amount to EUR18 million. They are estimated at EUR19 million in 2018, and EUR18 million in 2019 and 2020. Other long-term benefit obligations include long-service awards due by subsidiaries in France, for EUR13 million. At December 31, 2017, provisions for these benefit obligations total EUR277 million, compared with EUR452 million at December 31, 2016. These provisions have been included in non-current liabilities, as the current portion was not considered material in relation to the total liability.

22.1 – Changes in provisions for pensions and other post-employment benefit obligations Changes in provisions for pensions and other post-employment benefit obligations (net of plan assets) were as follows:

Other post-employment and long-term benefits

Provisions for pensions & other post-employment benefits

Pensions and termination benefits

Of which SE USA

Of which SE USA

Dec. 31, 2015

1,089

377

480

313

1,569

Net cost recognized in the statement of income

84

26

7

(7)

91

Benefits paid

(29)

-

(35)

(18)

(64)

Plan participants’ contributions Actuarial items recognized in equity

(104)

(40)

-

-

(104)

439

47 14

(13)

4

426

Translation adjustment

55 (4)

10

10

65 (1)

Changes in the scope of consolidation

- -

3

- -

Other changes Dec. 31, 2016

-

-

-

1,530

424

452 (64) (36)

302

1,982

Net cost recognized in the statement of income

82

23

(8)

18

Benefits paid

(28)

-

(16)

(64)

Plan participants’ contributions Actuarial items recognized in equity

(161)

(56) (27) (48)

-

-

(161)

(4)

(44) (37)

(47) (33)

(48)

Translation adjustment

(88)

(125)

Changes in the scope of consolidation

(7)

- -

6

- -

(1)

Other changes DEC. 31, 2017

-

-

-

1,324 (182) 1,506

316

277

198

1,601 (182) 1,783

Surplus of plans recognized as assets Provisions recognized as liabilities

-

-

-

316

277

198

Following the agreement reached with the Trustee of the Invensys Pension scheme in the UK in February 2014, Schneider Electric SE guaranteed all obligations of the Invensys subsidiaries which participate in the Scheme, up to amaximumamount of GBP1.75 billion.

At December 31, 2017, plan assets exceed the value of obligations subject to this guarantee and thus this guarantee cannot be called.

2017 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC

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