Page 72 - RFU Annual Report 2017

70
Financial Statements

Notes to the Financial Statements continued

27. Defined benefit pension scheme

(a) Description of the scheme
Rugby Football Union Retirement Benefits Scheme

The Union operates a defined benefit scheme in the UK. The scheme is closed to new entrants. This is a separate trustee
administered fund holding the pension scheme assets to meet long term pension liabilities. A full actuarial valuation was
carried out at 30 April 2014 and updated to 30 June 2017 by a qualified actuary, independent of the scheme’s sponsoring
employer. The major assumptions used by the actuary are shown below.

This most recent actuarial valuation showed a surplus of £0.6m (2016: £0.5m). The employer has agreed with the trustees
that it will pay annual contributions of £167,500 as a lump sum by the 31 July each year until 31 July 2018. In addition and
in accordance with the actuarial valuation, the employer has agreed with the trustees that it will pay 27.5% of Pensionable
Salaries in respect of the cost of accruing benefits. The employer will separately meet expenses of the scheme, insurance
premiums for death-in-service benefits and levies to the Pension Protection Fund. Member contributions are payable in
addition at the rate of 5.0% of pensionable salaries.

Present values of defined benefit obligation, fair value of assets and defined benefit liability:
2017 2016
(b) Balance sheet impact £m £m

Fair value of plan assets 40.0 38.9
Present value of defined benefit obligation (43.0) (44.0)

Defined benefit liability (3.0) (5.1)

2017 2016
(c) Reconciliation of the opening and closing balances of the defined benefit obligation £m £m

Defined benefit obligation at start of period 44.0 39.9
Current service cost 0.7 0.6
Interest expense 1.3 1.5
Contributions by plan participants 0.1 0.1
Actuarial (losses)/gains (1.4) 2.6
Benefits paid and expenses (1.7) (0.7)

Defined benefit obligation at end of period 43.0 44.0

2017 2016
(d) Reconciliation of the opening and closing balances of the fair value of scheme assets £m £m

Fair value of plan assets at start of period 38.9 36.4
Interest income 1.2 1.4
Actuarial gains 1.0 1.2
Contributions by the RFU 0.5 0.5
Contributions by plan participants 0.1 0.1
Benefits paid and expenses (1.7) (0.7)
Fair value of plan assets at end of period 40.0 38.9

The actual return on the plan assets over the period ended 30 June 2017 was £2.2m (2016: £2.6m).

Annual Report 2017