Getinge 2022 Annual Report
Getinge 2022 Annual Report
NOTE 23
Contract liabilities
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NOTE 24 Provisions for pensions and similar obligations
SEK M
Advances from customers
Service
Other
Total
2022
2021
1,279
793
772
613
285
2,336
227
1,633
Contract liabilities refers to advances from customers, deferred
income relating to service and other. Contract liabilities in the form
of deferred income and advances from customers in the begin-
ning of the year were essentially recognized in income during the
financial year.
Defined-contribution plans
In several countries, the Group's employees are covered by
defined-contribution pension plans. The pension plans are
primarily retirement pensions. The premiums are paid continuously
throughout the year by each Group company to separate legal
entities, such as insurance companies. The size of the premium
paid by the employees and Group companies is normally based
on a set proportion of the employee's salary and in certain cases
the employees pay for a portion of the premiums themselves. The
expense for defined-contribution plans amounted to SEK 357 M
(357) during 2022.
Defined-benefit plans
Getinge has large defined-benefit pension plans in Sweden,
Germany and the US. The pension plans primarily comprise retire-
ment pensions. Each employer normally has an obligation to pay
a lifelong pension. The pension is earned according to the number
of employment years and the employee must be affiliated with
the plan for a certain number of years to achieve full retirement
pension entitlement. Pension commitments are calculated based
on actuarial assumptions and gains and losses of changed actuarial
assumptions are recognized as part of comprehensive income.
Sweden
Most of the Group's defined-benefit pension commitments in
Sweden are so called PRI liabilities. These plans are closed for new
employees but remain open for the employees encompassed by the
plans. The commitments pertain to lifelong retirement pensions
and the benefits are primarily based on the employees' final salary.
The pension commitments were calculated at a discount rate based
on the return on the market rate of Swedish mortgage bonds. These
bonds are deemed to be of high quality since they are guaranteed by
assets and the mortgage bond market in Sweden is considered to be
deep and liquid. The terms of the bonds correspond to the average
term of the commitments, which is 21 years.
At year-end, the amount of the Group's defined-benefit pension
commitments in Sweden totaled SEK 449 M (627). The Swedish
pension commitments decreased year-on-year mainly due to a
higher discount rate. Plan assets exist to only a minor extent and
are attributable to a small plan that is not credit insured.
Germany
Some employees in Germany are part of defined-benefit pension
plans. These plans are closed for new employees but remain open
for the employees encompassed by the plan. The benefits are
based on the employees' final salary and the remaining weighted
average term of the total commitment is 13 years. The pension
plans are insured in accordance with statutory requirements.
Total defined-benefit pension commitments decreased to
SEK 1,785 M (2,404) during the year. The decrease was mainly due
to higher discount rate assumptions partly offset by currency rate
fluctuation. The discount rate is based on high-quality corporate
bonds with a term corresponding to the average remaining term
of the commitment.
USA
The Group's defined-benefit pension commitment in the US is
closed for new employees and also to the employees encompassed
by the plan, meaning that no new pension rights are vested.
The commitment's remaining average term is 11 years.
The total defined-benefit commitment decreased to
SEK 1,080 M (1,230), mainly due higher discount rate offset by
currency rate fluctuation.
The value of the plan assets decreased from SEK 802 M to
SEK 800 M, mainly due to the current year negative return on
plan assets, offset primarily by currency rate change. Both the
defined-benefit commitment and the return on the plan assets
were calculated using a discount rate based on high-quality
corporate bonds with a term corresponding to the average
remaining term of the commitment.
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